US Pending Home Sales Hit Record Low in September
US pending home sales plunged to a record low in September as rising mortgage rates and construction costs triggered a broad housing market downturn.
The United States housing market experienced a severe downturn in September 2026, marked by a record collapse in pending home sales and a sharp decline in new construction. The Pending Home Sales Index fell 7.3% to 66.0, the lowest level since the series began in 2001. This slump was driven by 30-year fixed mortgage rates, which rose from approximately 6.8% to 7.6% during the month, averaging 7.40% by mid-October.
Construction activity also contracted as single-family housing starts fell 4.6% to a seasonally adjusted annual rate of 859,000 units. Building permits dropped 4.0% to 845,000 units, the lowest level since March 2023. Homebuilder sentiment hit a 14-year low in October, weighed down by labor shortages linked to an immigration crackdown, expensive diesel, and rising material costs.
Regional data shows contracts fell across the country, with the West seeing the steepest monthly drop at 9.2%. Economists attribute the depressed demand to borrowing costs tracking Treasury yields amid inflationary pressures linked to the US-Israeli war with Iran. This economic volatility coincides with the lead-up to the November 3 midterm elections. President Donald Trump previously refused to sign a bipartisan housing affordability bill, calling it "a big yawn," though the legislation eventually became law without his signature.
