September pending home sales plunge 14 percent

Published 8:23 am Thursday, October 19, 2023

Rising mortgage rates and low inventory combined with seasonality to push September’s pending home sales down 14 percent. The effect will be a continuation of existing home sales retreating to pre-pandemic levels.

 Buyers accepted 109 fewer contracts than they did during August and 64  fewer than this time last year. At month’s end the total was 688. 

Pending sales represent homes that have a signed purchase contract but have not closed. Accepted contracts typically close in a month to six weeks.

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NETAR’s Pending Sales Index dropped 17 points from the previous month. It’s down 10 points from September last year. The index removes some of the noise from the monthly raw numbers and benchmarks how the market is performing against a pre-pandemic baseline. The index is a forward-looking indicator based on the 2018 annual average for signed contracts instead of closings. An index of 100 is equal to the pre-pandemic accepted contracts level. An index of over 100 is the percentage increase, below 100 is a decline. 

There were 209 pending sales in the affordable homes market last month. That’s 58 fewer than during August and nine more than last year.  

There was also a small gain in the move-up market. It increased from the Aug. total by two contracts. Sept. was down 23 from last year. The price range that posted an increase was $300K-399,999. It was up 18 percent from last year.

Accepted contracts in the Luxury Market increased 59 percent in September. There were 78 new pending sales in the $500K and above market.