Pending home sales have dropped to their lowest level since April, with the daily average mortgage rate climbing to 6.85%. Yet buyers still hold negotiating power as sellers continue to outnumber active purchasers across most of the country.
Source: Original report
Demand Retreats Alongside Rising Rates
U.S. pending home sales slipped to their weakest point since early April during the four weeks ending July 26, with the most recent week alone registering a 1.7% decline. The pullback coincides with mortgage rates climbing to a daily average of 6.85%—the highest reading in more than a year—according to data compiled by Redfin.
Buyer activity, as measured by home tours, has risen roughly 15% since January, but that pace trails the 31% gain recorded at the same point last year, per ShowingTime data. The gap signals that the initial momentum that carried into 2026 has faded.
What Is Pushing Rates Higher?
Rates have remained elevated due to persistent inflation concerns and volatility in oil markets linked to ongoing geopolitical tensions. Despite a labor market that continues to hold up, the combination of high borrowing costs and broader economic uncertainty has led many prospective buyers to delay their searches.
Analysts see little near-term relief on the rate front, meaning affordability pressure is unlikely to ease quickly for buyers who depend on financing.
A Silver Lining for Active Buyers
Even with rates near recent highs, the median U.S. housing payment edged down to $2,575—its lowest point in three months—as sellers trimmed asking prices to their lowest level in roughly a year. That cost reduction gives buyers who remain in the market some financial breathing room.
New listings have also dipped to their second-lowest level since the start of 2026, suggesting some potential sellers are stepping back in response to softer demand. Even so, available inventory still exceeds the pool of active buyers by a wide margin, tilting negotiating leverage toward purchasers in most parts of the country.
Patience Is the Strategy, Agents Say
Redfin Premier agent Bonnie Phillips, based in Cleveland, noted that while pandemic-era rates were considerably lower, every listing drew fierce competition and buyers routinely paid well above asking price. Today, bidding wars are uncommon, price reductions are achievable, and seller concessions are back on the table.
Her advice: focus on finding the right home and securing favorable terms rather than waiting for a perfect rate environment that may not materialize. As she put it, the current market rewards patience over panic.
Key Data Points at a Glance
- Pending home sales: lowest level since early April
- Weekly decline in pending sales: 1.7%
- Daily average 30-year mortgage rate: 6.85% (highest in over a year)
- Home tour activity: up 15% year-to-date vs. 31% at the same time last year
- Median U.S. housing payment: $2,575 (three-month low)
- Seller asking prices: lowest level in approximately one year
Redfin's national metrics are drawn from more than 900 U.S. metro areas and cover homes listed or sold during the reported period.
