Pending home sales fell to a five-month low in late July as mortgage rates climbed to nearly a year-high, according to Redfin’s weekly housing market update published Aug. 6. A companion Redfin report the same day found that the slowdown is handing buyers unusual leverage heading into late summer, with sellers increasingly offering price cuts and concessions to close deals.
Pending sales totaled 311,150 on a seasonally adjusted basis in the four weeks ending Aug. 2, down 3.7% from the prior week β the steepest weekly drop since 2022 β and down 1.9% from a year earlier. That marks the lowest level of pending sales in more than five months, Redfin said.
Rates near a one-year high
The pullback tracks a run-up in borrowing costs. Redfin’s daily average 30-year fixed mortgage rate hit 6.82% on Aug. 3, and its weekly average reached 6.66% for the week ending July 30 β the highest weekly reading in nearly a year. Mortgage-purchase applications fell 4% from the prior week, though they remained up 3% from a year earlier.
The median U.S. home sale price was $406,362, up 2.9% year over year, while the median asking price rose a more modest 1.1% to $398,666. The typical monthly mortgage payment climbed to $2,631 at the prevailing rate, up 0.6% from a year ago. Homes sat on the market a median of 41 days, one day faster than the prior reading, and 27.6% of homes sold above their list price.
Inventory continued to build even as demand cooled. New listings rose 1% from the prior week and 0.2% year over year to 354,313, while active listings slipped 0.3% year over year to nearly 1.47 million. Months of supply held steady at 3.6 β within the range real estate economists generally consider a balanced market, though conditions vary sharply by metro. Google searches for “homes for sale” were down about 3% from a month earlier and 6% from a year ago, another sign of cooling buyer traffic.
Price and sales trends diverged widely by market. Newark, New Jersey (up 9.8%), West Palm Beach, Florida (up 9.5%) and Baltimore (up 7.6%) posted the strongest year-over-year price gains, while San Jose, California (down 4.2%), Seattle (down 1.8%) and Dallas (down 1.6%) recorded the steepest declines. Pending sales grew fastest in West Palm Beach (up 13%), Cincinnati (up 7.1%) and Pittsburgh (up 6.7%), while Seattle (down 19.8%), Houston (down 17.1%) and Phoenix (down 15%) saw the sharpest pullbacks.
Sellers sweeten the deal
In a separate report on the late-summer market, Redfin said the same combination of elevated rates and rising inventory is shifting negotiating power toward buyers in much of the country, even as well-priced, move-in-ready homes continue to sell quickly. “Late summer offers negotiating opportunities for motivated buyers and sellers willing to make concessions,” said Chen Zhao, Redfin’s head of economics research.
The pattern is playing out unevenly across metros the company highlighted. In Austin, years of rapid homebuilding and population growth have tipped the market toward buyers, with the brisk pace of recent years cooling noticeably. In Chicago, demand remains firm in neighborhoods such as Evanston and Lincoln Park, though Redfin cited a three-bedroom bungalow in Norwood Park that sold after a $25,000 price cut. Nashville is seeing a more pronounced slowdown: Redfin pointed to first-time buyers who closed on a $345,000 home appraised at $360,000 with the seller covering closing costs, and to transplants who negotiated a $60,000 discount on a $1.15 million house in Brentwood. San Diego’s market was mixed, with move-in-ready single-family homes still in demand while condos linger longer and see softening prices.
What it means
The five-month low in pending sales and the steepest weekly decline since 2022 are verified figures from Redfin’s own transaction data, as is the rate environment driving them. Redfin’s characterization of a buyer-friendly market β including the specific negotiated discounts in Nashville and Chicago β reflects the company’s interpretation of its agents’ recent deals rather than a comprehensive national survey, and should be read as illustrative rather than representative of every market. Months of supply nationally remains within a historically balanced range, underscoring that the shift in leverage is concentrated in specific metros β largely those that overbuilt or saw the sharpest pandemic-era price run-ups β rather than uniform nationwide.
What to watch: mortgage rates remain the key swing factor heading into the fall selling season. Redfin’s weekly rate tracker sits just below the 6.85% one-year high reached in late July, and any further increase would likely deepen the pending-sales slowdown, while a pullback could quickly re-tighten the still-limited supply in faster-moving metros.
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