The U.S. housing market showed a small improvement in August, but buyers still signed fewer contracts than a year earlier. Pending home sales rose 0.3% from July, while they fell 4.7% from August 2025, according to the National Association of REALTORS® (NAR) Pending Home Sales report.
Pending home sales track homes that have gone under contract but have not yet closed. The data gives agents, buyers, and sellers a closer look at current housing demand.
Regional Results
The monthly numbers varied across the country. Pending sales grew in the South and West but dropped in the Northeast and Midwest. However, all four regions recorded annual declines.
The Northeast posted a 4.2% monthly drop and a 3.9% yearly decline. The Midwest fell 1.6% from July and 4.9% from a year earlier. The South gained 2.3% month over month but declined 3.8% year over year. The West recorded the largest monthly gain at 3.0%, yet sales remained 6.7% below August 2025 levels.
NAR Chief Economist Dr. Lawrence Yun said, “Buyers steadily entered into contracts in August even though mortgage rates increased.” He added that the market remains sluggish because higher mortgage rates continue to offset stronger job gains and income growth.
Yun also linked weaker activity in the Northeast and Midwest to faster home price growth in those regions.
Stronger Metro Markets
Some large metro areas still recorded annual gains. Realtor.com® Economics data showed the biggest increases among the 50 largest U.S. metro areas:
Richmond, VA: +11.3%
San Antonio-New Braunfels, TX: +6.6%
Memphis, TN-MS-AR: +6.4%
Virginia Beach-Chesapeake-Norfolk, VA-NC: +5.1%
Cincinnati, OH-KY-IN: +4.7%
Austin-Round Rock-San Marcos, TX: +4.2%
Birmingham, AL: +4.0%
Sacramento-Roseville-Folsom, CA: +1.7%
Indianapolis-Carmel-Greenwood, IN: +0.9%
St. Louis, MO-IL: +0.2%
Despite the monthly increase, pending contracts remain well below pre-pandemic levels. Yun said national contract signings are about 30% below levels seen in the years before the pandemic. Activity reached a peak in 2021 when mortgage rates fell close to 3%.
The August results show a housing market where buyers remain active, but borrowing costs and home prices continue to shape their decisions.
August brought a modest rise in pending sales, but the yearly decline shows that demand has not fully recovered. Regional results also point to different conditions across the country. Mortgage rates, income growth, jobs, and home prices continue to influence how quickly buyers enter contracts.
