Pending home sales took a sharp step back in December, raising fresh concerns about the housing market’s momentum as 2026 begins.
Signed contracts on existing homes dropped 9.3% month over month, according to the National Association of Realtors. Economists had expected a small increase, making the decline a notable surprise. Compared with December 2024, pending sales were down 3%.
“The housing sector is not out of the woods yet,” said Lawrence Yun. “After several months of improving contract activity and closings, the December slowdown weakens the near-term outlook.”
Sales Fell Across Nearly All Regions
Pending sales declined from November in every U.S. region. On a year-over-year basis, only the South managed to post an increase, while other areas continued to struggle with affordability and limited choices.
Homes also took longer to sell. Properties spent an average of 39 days on the market in December, up from 35 days a year earlier. That longer timeline reflects growing hesitation among buyers, even as demand remains pent-up.
Mortgage Rates Didn’t Offer Much Help
When these contracts were signed, mortgage rates were largely unchanged. The average 30-year fixed mortgage rate hovered near 6.25%, according to Mortgage News Daily. While lower than summer highs, the lack of meaningful movement failed to spark new urgency among buyers.
At the same time, shoppers faced a shrinking pool of available homes.
Inventory Hit a 2025 Low
There were just 1.18 million homes for sale nationwide in December, down 9% from November and matching the lowest inventory level seen in 2025. Inventory was higher than a year earlier, but that comparison comes off extremely depressed levels.
“Buyers want options,” Yun said. “When inventory is tight, people are less willing to make such a large financial decision. The drop in pending sales likely reflects that hesitation.”
What It Means for 2026
The December data suggests the housing market is entering 2026 without strong forward momentum. Stable mortgage rates, thin inventory, and economic uncertainty are combining to keep many buyers on the sidelines.
Unless inventory improves or borrowing costs fall more meaningfully, early 2026 could remain slow, with buyers taking a cautious wait-and-see approach rather than rushing back into the market. For direct financing consultations or mortgage options for you visit 👉 Nadlan Capital Group.
