Pending Home Sales Rise Despite High Mortgage Rates

Buyer activity improved in August, but affordability remains a challenge — here’s what today’s market means for home sellers.

Short answer: Pending home sales rose 0.3% in August compared to July, according to the National Association of Realtors, even as mortgage rates stayed elevated. But the broader picture remains soft: pending sales were still down 4.7% from a year earlier, and contract signings remain roughly 30% below pre-pandemic levels. For sellers, this means buyers are still out there and still willing to sign contracts, but affordability is making them far more selective about which homes get an offer.

What Are Pending Home Sales, and Why Do They Matter?

Pending home sales measure homes that have gone under contract but haven’t closed yet. Because most transactions close several weeks after a contract is signed, this figure works as an early indicator of where completed home sales are likely headed in the following month or two — making it one of the more forward-looking numbers in housing data, rather than a lagging one.

How Much Did Pending Sales Actually Increase?

The National Association of Realtors reported a 0.3% increase in pending home sales for August compared to July. Regionally, the picture was mixed: the South and West both posted month-over-month gains, while the Northeast and Midwest saw declines over the same period. NAR’s chief economist attributed the regional split partly to the Northeast and Midwest experiencing the fastest home-price growth in August, which likely weighed on contract signings in those specific markets.

Does a 0.3% Increase Mean the Market Is Recovering?

Not decisively — it’s a modest, encouraging signal rather than a clear turnaround. Compared to a year earlier, pending sales were still down 4.7% nationally, with every major region posting an annual decline. And overall contract activity remains roughly 30% below pre-pandemic levels, according to NAR’s chief economist. The August uptick shows buyers are still willing to act despite elevated borrowing costs — it doesn’t erase the broader affordability pressure still weighing on the market.

Why Are High Mortgage Rates Still the Central Issue?

Mortgage rates in the 7% range change a buyer’s monthly payment dramatically compared to the sub-4% rates available just a few years ago. Facing that reality, buyers generally respond in one of three ways: stretching their monthly housing budget further than they’d prefer, shifting their search to a less expensive home, or simply waiting to purchase until conditions feel more favorable. NAR’s chief economist noted that higher mortgage rates are currently offsetting the additional purchasing power buyers have gained from job growth and income increases outpacing home-price growth — a tug-of-war between improving income and worsening financing costs.

Have Buyers Disappeared From the Market?

No. People still relocate for jobs, families still grow, homeowners still retire or downsize, and first-time buyers are still entering the market — the reasons people buy homes don’t pause because rates are elevated. The August data reinforces this directly: buyer activity actually ticked up slightly even with mortgage rates remaining high. What’s different is that today’s buyers have less room in their budgets and more reason to scrutinize every home they consider before committing.

How Should This Change Your Pricing Strategy as a Seller?

Today’s buyers can instantly compare your home against every competing listing in their price range and budget. A home that appears overpriced often doesn’t generate a lower offer — it simply gets passed over while buyers move on to something that looks like better value. Since the first days and weeks after listing typically generate the most attention and traffic, starting too high and correcting the price weeks later usually costs you that early exposure rather than preserving it.

What Else Should Sellers Pay Attention to Beyond Price?

A buyer financing at 7% evaluates a home differently than a buyer financing at 3% did a few years ago — monthly payment, property taxes, insurance, and HOA fees all weigh more heavily in their decision now, since less flexibility exists in the budget for surprises after closing. Presentation matters more too: professional photography, staging, curb appeal, and completed repairs all influence whether a buyer schedules a showing at all in a market where they have real alternatives to choose from. And sellers should be ready for more negotiation than in a low-rate environment — buyers may request price adjustments, closing-cost assistance, or repair credits, which doesn’t mean accepting every request, but does mean having someone who can negotiate those points strategically rather than reactively.

Should You Wait for Mortgage Rates to Fall Before Selling?

That’s a harder bet than it might seem. No one can reliably predict exactly when rates will decline or by how much. And if rates do eventually fall meaningfully, it could bring more sellers off the sidelines too — homeowners currently reluctant to give up an existing low-rate mortgage may finally decide to list, which means more buyers but also more competing inventory. Rather than trying to time the rate environment perfectly, the more useful question is whether selling makes sense for your specific circumstances and your specific local market right now.

Does Your Choice of Agent Matter More When the Market Is This Selective?

Arguably, yes. When buyers are pickier and more rate-sensitive, pricing accuracy and negotiation skill have an outsized effect on your outcome — and every dollar that doesn’t go to commission is a dollar that stays in your pocket in a market where margins for error are tighter than they were a few years ago.

	Traditional agent	IDEAL AGENT	You save
Listing commission	3%	2%	1%
Buyer’s agent commission	3%	2%	1%
Total (if buyer has an agent)	6%	4%	2%

If a buyer comes directly through your IDEAL AGENT agent’s own marketing, with no separate buyer’s agent involved, your total commission is capped at just 2% combined. IDEAL AGENT connects sellers with a top 1% local agent with a proven track record in your specific market — someone who understands exactly how today’s rate-sensitive buyers are evaluating homes, at a fraction of the traditional commission cost.

What Should You Actually Do With This Information?

Don’t base a decision this size on national headlines alone. Find out what’s actually happening with prices, inventory, and buyer demand specific to your property and neighborhood — that local picture matters far more than a national percentage when it comes to setting your price and your expectations.

Frequently Asked Questions

What exactly are pending home sales, and how is this different from closed sales?

Pending sales track homes that have gone under contract but not yet closed, making the figure a leading indicator — closed sales, by contrast, reflect transactions that have already fully completed, typically a month or two after the contract stage.

Why did pending sales rise nationally but fall in some regions?

Regional differences in home-price growth and local affordability conditions can cause different parts of the country to move in opposite directions in the same month — the Northeast and Midwest saw faster price growth in August, which appears to have weighed on contract activity there specifically.

Does a 0.3% monthly increase mean the housing market has turned a corner?

Not definitively — it’s a modest, encouraging signal, but pending sales remain down meaningfully from a year ago and well below pre-pandemic activity levels, so it’s best read as stabilization rather than a clear recovery.

Should I wait to sell until mortgage rates come down?

Waiting is a bet on timing that’s difficult to make reliably, and a future rate drop could bring more competing sellers to market at the same time it brings more buyers. Your personal circumstances and local market conditions are generally a more reliable basis for the decision.

How does a 7% mortgage rate change what buyers can actually afford?

It significantly increases the monthly payment for the same loan amount compared to a 3-4% rate, which often pushes buyers toward a lower price range, a longer search, or more caution about additional costs like renovations after closing.

Is now still a reasonable time to sell my home?

It can be, provided your price, presentation, and marketing are built around today’s more selective, rate-sensitive buyer rather than the conditions of a few years ago. The right strategy matters more in a tighter market, not less.

What can I do to make my home stand out to today’s buyers?

Focus on accurate initial pricing, strong presentation (photography, staging, curb appeal), and being prepared to negotiate thoughtfully on requests like closing-cost credits or repairs, since buyers today have more comparison options and less budget flexibility than in a lower-rate environment.

Don’t base one of your largest financial decisions on national headlines alone. Get matched with a top 1% local agent who can build a selling strategy around what’s actually happening in your specific market, listing for 2% commission.