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The U.S. housing market is shaping up to have a lackluster summer.
Pending home sales, a measure of deals that went into contract, dipped 0.3 percent this June compared to last, according to the National Association of Realtors. They fell by 5.4 percent compared to the month before.
Spring was fairly strong for home sales, noted Joel Berner, a senior economist at Realtor.com. The latest pending sales, a preview of deals that will close in a month or two, signals a weakening market as financing costs remain high.
As of July 16, the average 30-year, fixed-rate mortgage rate hit 6.55 percent. While the median listing price in June slid 2.5 percent year over year in June, per Realtor.com, affordability continues to be a factor for many homebuyers.
“It feels like we just gave away all that momentum,” Berner said. “We’re in the heat of summer now and we’ll need a late summer pickup to get back to where we were if we’re going to beat 2025 by a significant margin.”
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There also is a lack of consumer confidence, Berner said. While the unemployment rate ticked down in June, hirings grew at a softer rate month over month compared to the month before.
“People just don’t feel terribly confident,” he said. “There’s just a reluctance among buyers right now that’s spread across regions.”
The country’s four main regions all posted declines in pending deals month over month, with the Midwest reporting the steepest drop of nearly 9 percent. To Berner, that signals an inventory constraint problem, especially in markets like Chicago.
“They’re just aren’t enough homes for sale for prices to be competitive enough for people to afford or at least have options,” he said.
On a year-over-year basis, the Midwest and Northeast posted gains in pending home sales, while the South and West, still grappling with normalizing post-pandemic plus a surge in construction activity, saw declines of 0.9 percent and 1.1 percent, respectively.
Still, Berner is optimistic about the rest of 2026. After all, the fall buying season is around the corner.
“The best time of year to buy a home is coming up,” he said. “So there could be some opportunities for some homes that have been sitting on the market for a while to get snatched up for really good deals.”