Pending Home Sales February 2026: Modest Growth Led by Midwest South and West
The U.S. housing market showed a small increase in activity in early 2026, as pending home sales moved slightly higher in February.
According to the latest data from the National Association of Realtors (NAR), pending home sales increased by 1.8% compared to January, signaling a modest improvement in buyer activity. However, on a yearly basis, contract signings were still down by 0.8%, showing that the market has not fully recovered.
Pending home sales are considered an early indicator of future completed transactions, as they track signed contracts before deals close.
Affordability Helped Push Sales Higher
The slight increase in pending home sales February 2026 appears to be linked to improved affordability conditions.
Lower mortgage rates earlier in the year and some price stabilization in certain regions made it easier for buyers to enter the market.
However, economists warn that this improvement may not last.
Rising oil prices and inflation concerns could lead to higher mortgage rates, which may reduce affordability again in the coming months.
Regional Trends Show Mixed Performance
Housing activity varied across different regions of the United States, with some areas showing growth while others continued to struggle.
Northeast
- Down 3.6% month-over-month
- Down 12.1% year-over-year
The Northeast remained the weakest region, mainly due to higher home prices and limited housing supply.
Midwest
- Up 4.6% month-over-month
- Down 0.1% year-over-year
The Midwest posted the strongest monthly growth, supported by relatively lower home prices compared with other regions.
South
- Up 2.7% month-over-month
- Up 1.2% year-over-year
The South continued to show steady demand, benefiting from population growth and more available housing.
West
- Up 0.9% month-over-month
- Up 3.2% year-over-year
The West also recorded gains, although affordability challenges and limited supply remain ongoing concerns.
Midwest Stands Out for Affordability
Among all regions, the Midwest stood out as the most affordable housing market.
Lower home prices compared with coastal areas have helped attract buyers, even as borrowing costs remain relatively high.
In contrast, the Northeast has struggled due to a combination of high prices and limited inventory, which continues to slow market activity.
Strong Growth in Several Metro Areas
At the local level, several major metro areas reported notable increases in pending home sales compared with the previous year.
Some of the strongest-performing markets include:
- San Diego–Chula Vista–Carlsbad, CA (+13.5%)
- Jacksonville, FL (+12.1%)
- San Jose–Sunnyvale–Santa Clara, CA (+10.6%)
- Denver–Aurora–Centennial, CO (+10.5%)
- Miami–Fort Lauderdale–West Palm Beach, FL (+10.0%)
- Phoenix–Mesa–Chandler, AZ (+9.8%)
- Sacramento–Roseville–Folsom, CA (+9.3%)
- Kansas City, MO-KS (+8.7%)
- Austin–Round Rock–San Marcos, TX (+8.1%)
- Oklahoma City (+8.7%)
These gains show that demand remains strong in certain markets, especially those offering job opportunities, population growth, or relative affordability.
Why Pending Home Sales Matter
Pending home sales are an important measure because they reflect buyer intent before transactions are finalized.
However, not all pending contracts result in completed sales.
Several factors can delay or cancel deals, including:
- Mortgage approval issues
- Home inspection concerns
- Appraisal differences
- Changes in buyer finances
Because of these variables, there is usually a gap between contract signings and final home sales data.
Market Challenges Still Remain
Despite the monthly increase, the housing market continues to face several challenges.
Limited housing supply remains one of the biggest obstacles, especially in higher-priced regions.
At the same time, rising mortgage rates and inflation pressures could reduce buyer demand if borrowing costs increase further.
Economic uncertainty, including global energy prices, may also influence housing activity in the months ahead.
Demand Still Exists in the Market
Even with current challenges, there is still strong underlying demand for housing.
Many potential buyers, especially first-time buyers, are waiting for better conditions before entering the market.
Factors such as saving for a down payment, improving credit scores, and completing lease agreements can delay home purchases.
However, this “pent-up demand” could return quickly if affordability improves.
Outlook for the Housing Market
The latest pending home sales February 2026 data suggests that the housing market is stabilizing but not fully recovering.
Future trends will depend on several key factors:
- Mortgage rate movements
- Housing supply levels
- Job growth and income trends
- Inflation and energy prices
If borrowing costs remain stable and more homes become available, pending sales could continue to improve.
However, if mortgage rates rise again, the recent gains may be difficult to sustain.
Summary
Pending home sales showed a small increase in February, driven mainly by improved affordability and stronger activity in key regions.
At the same time, year-over-year declines and regional differences highlight ongoing challenges in the housing market.
In simple terms:
- Sales activity is improving slightly
- Demand remains present
- Supply and affordability are still key concerns
The next few months will be important in determining whether the housing market can build on this momentum or face renewed pressure from rising costs. For direct financing consultations or mortgage options for you visit 👉 Nadlan Capital Group.
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