Despite tumbling mortgage rates and surging mortgage applications, pending home sales in the US rose just 0.6% MoM in August (less than the 1.0% MoM expected jump back from the 5.5% plunge in July).

Source: Bloomberg

Pending home sales were down 4.3% YoY (and have not been positive on a YoY basis since Nov 2021).

That lifted the pending home sales index just off its all-time record lows…

Source: Bloomberg

“A slight upward turn reflects a modest improvement in housing affordability, primarily because mortgage rates descended to 6.5% in August,” NAR Chief Economist Lawrence Yun said in a prepared statement.

“However, contract signings remain near cyclical lows even as home prices keep marching to new record highs.”

Across the US, pending sales rose in the Midwest, South and West, but the Northeast index fell to its lowest point since the start of the pandemic in 2020.

Pending-homes sales tend to be a leading indicator for previously owned homes, because houses typically go under contract a month or two before they’re sold.