Redfin: Pending Home Sales Fall to Lowest Level Since 2014, Outside April 2020

U.S. pending home sales fell in September to their lowest level since spring 2014, with the single exception of April 2020, according to a Redfin report released Monday, Oct. 12 (press release). Pending sales count homes that went under contract, so they show where closed sales are likely to head next.

Why this matters: Contract signings are an early signal for the purchase business. Redfin ties September's drop largely to mortgage rates moving above 7% late in the month, the same level MBA now expects to persist through 2027.

Cover: Editorial illustration for Redfin's September pending-sales report. Illustration created for mortgage.news; it does not depict a real person, property, product screen or document.

What Redfin measured in September

Redfin says its figures are seasonally adjusted, except median sale prices and mortgage rates:

• Pending home sales fell 4% from August, the biggest monthly drop in more than three years.
• Pending sales fell year over year in all 50 of the most populous U.S. metros, the first time since September 2023.
• Closed sales fell 1.6% from August to their lowest level since the end of 2023.
• Total homes for sale rose 1.2% to the highest level since March 2020; new listings rose 0.3%.
• The median sale price rose 1.3% from a year earlier to $393,895, the smallest increase since February.
• 14.5% of homes that went under contract in September had the deal canceled, the highest share on record other than March and April 2020.

Where the drop was steepest

The largest year-over-year declines in pending sales were on the West Coast: Seattle (-24.4%), Los Angeles (-16%), San Diego (-15.8%) and Anaheim, California (-15.5%). Cancellations were most common in Jacksonville, Florida (19.9%), followed by Tampa (18.8%), Las Vegas (18.6%), San Antonio (18.5%) and Phoenix (18.4%). San Francisco had the lowest cancellation rate, 2.8%.

Redfin's interpretation

Redfin says fewer homes went under contract mainly because rates rose steadily and its weekly average mortgage rate reached 7.28% at the end of September. That is Redfin's explanation, not a separately measured cause. Chen Zhao, Redfin's head of economic research, said slower sales give buyers more room to negotiate on price, closing costs, repairs and sometimes rate buydowns.

Other signs Redfin cited: median asking prices fell 0.5% from August, 60.5% of homes sold below their original asking price, and 19.8% of sellers with active listings cut their price.

Practical takeaway

For buyers: more supply and more canceled deals mean more room to ask for seller credits or repairs. Get a fully underwritten preapproval so a payment surprise does not end your deal.

For agents and loan officers: the high cancellation rate is a reason to review payment and cash-to-close numbers with buyers before they sign, not after inspection.

These are September figures. Monday is Columbus Day, and SIFMA recommends a full U.S. bond-market close, so today's rates are not being set by live bond trading.