Asking prices fall for first time since March as rates hit 7.4%
Demand at a critical low
Pending home sales — contracts signed but not yet closed — ticked up just 1.5% week over week in the period, but remain near their lowest level in records dating to 2021, including the late-2023 period when rates were nearing 8%.
On an annual basis, pending transactions posted declines across every one of the 50 most populous US metro areas, the first across-the-board contraction of that kind in three years, according to Redfin.
Mike Fratantoni, chief economist at the Mortgage Bankers Association (MBA), recently told MPA that the market had fundamentally shifted since the start of the year.
“We started 2026 with mortgage rates briefly below 6%, and saw just how much of an impact that had on both refinance and purchase volume,” he said.
“It really, really caught folks’ attention. Because I think now most buyers in the market, they recognize that a low 6% or below 6% is a very good rate. Seven percent is not a good rate, but they’re not looking for a 3% rate anymore. That’s where we started the year. The Middle East conflict is absolutely the variable that really threw our forecast off.”
