Pending Home Sales Index Falls Despite Lower Mortgage Rates

Mark Lieberman

Managing Director and Senior Economist


  • National Association of Realtors’ Pending Home Sales Index (PHSI) FELL 1.7 percentage points in October to 106.7;
  • The September PHSI was revised down to 108.6 from 108.7
  • Year-year the index ROSE 4.5 percentage points.


  • The PHSI decline was only the fourth this year;
  • Year-year the Index has risen three months in a row for the first time since July 2016-March 2017.

Data Source: National Association of Realtors (NAR

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With mortgage rates remaining low the National Association of Realtors Pending Home Sales fell in October for just the second time in the last six months.

The NAR’s report came as Freddie Mac ‘s weekly mortgage survey showed the average rate for a 30-year fixed rate loan rose to 3.69 percent from 3.61 percent in September, still at historically low levels.

The dip in the index – which measures contracts for sale, not closings — tracked the government’s new home sales report – which also measures contracts for sale – of a 0.7 percent decline in new home sales in October.

And like the new home sales report, the PHSI is up sharply from 2018. The October 2018 pending home sales index was 102.7. The pace of new home sales in October, according to the Census Bureau Department of Housing and Urban Development report, was 31.5 percent higher than October 2018.

Sales contracts for existing homes fell in three of the four Census regions in October, improving in only the Northeast while the PHSI was up in the Midwest and West in October but down in the Northeast and South.

The dip in the PHSI in October pointed to a downturn in closed sales in December. When the PHSI rose 1.4 percentage points in August, completed sales, closings, rose 1.9 percent in October.

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