National Association of REALTORS® Reports 4.0% Increase in Pending Home Sales in August

What's Happening?

The National Association of REALTORS® (NAR) has reported a 4.0% increase in pending home sales for August 2025 compared to the previous month, with a 3.8% rise year-over-year. The Pending Home Sales Index (PHSI), which serves as a forward-looking indicator of home sales based on contract signings, showed growth in most regions except the Northeast, which experienced a slight decline. The Midwest saw the most significant month-over-month increase at 8.7%, followed by the West at 5.0%, the South at 3.1%, while the Northeast saw a 1.1% decrease. Year-over-year, all regions reported increases, with the Midwest leading at 6.7%. According to NAR Chief Economist Lawrence Yun, lower mortgage rates are facilitating more home buyers to enter contracts, particularly in the Midwest where affordability is higher.

Why It's Important?

The increase in pending home sales is a positive indicator for the U.S. housing market, suggesting a rebound in buyer activity driven by declining mortgage rates. This trend is significant as it reflects consumer confidence and economic stability, potentially leading to increased economic activity in related sectors such as construction, home improvement, and real estate services. The rise in pending sales could also influence housing prices, inventory levels, and market dynamics, impacting both buyers and sellers. Regions with higher affordability, like the Midwest, may see more pronounced benefits, while areas with declining sales, such as the Northeast, might face challenges in attracting buyers.

What's Next?

The NAR's report indicates that the next Existing-Home Sales data will be released on October 23, followed by the next Pending Home Sales Index on October 29. These upcoming reports will provide further insights into the housing market's trajectory. Stakeholders, including real estate professionals, policymakers, and potential home buyers, will be closely monitoring these releases to gauge the market's health and make informed decisions. Additionally, any changes in mortgage rates or economic conditions could further influence future sales activity.