Home Sales Beat Expectations in September But Remain Low Overall Due to High Mortgage Rates

Pending home sales unexpectedly increased 1.1% in September from August, beating economists' forecasts of a 2% decline. This may reflect buyers jumping on temporarily lower mortgage rates before they rose again.

Pending home sales remain at historically low levels overall due to high mortgage rates, limiting inventory and keeping prices elevated. Existing home sales are predicted to fall 17.5% in 2022.

The temporary September pause in rising mortgage rates may have convinced some buyers to make offers, before rates jumped to over 7% in October.

New home sales also beat expectations in September, possibly because builders can offer concessions and increase supply more easily than existing sellers.

Low inventory continues to prop up prices and limit options for buyers. Single-family home listings are at their lowest level since 1982.