Zillow: Pending Home Sales Drop 8.5% in September Slowdown
Zillow's September report signals a cooling housing market as pending sales sink and mortgage pressure persists, while rents post their strongest annual gain since April.
The U.S. housing market entered an early seasonal chill in September, with newly pending home sales declining 8.5% — a forward-looking measure that signals further weakness in closed transactions ahead, according to Zillow's latest monthly market report.
Existing home sales also retreated, falling 2.5% compared with the same month a year earlier, Zillow's nowcast showed. Newly pending sales are considered a leading indicator because they capture signed contracts before deals formally close, making the sharp drop a closely watched warning sign for the weeks ahead.
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Mortgage conditions continued to weigh on buyer activity during the month, limiting the pool of prospective purchasers able to move forward with transactions. Elevated borrowing costs have been a persistent drag on housing demand throughout much of the recent cycle, and September's data suggests that pressure has not meaningfully eased.
In contrast, the rental market showed relative resilience. Zillow's report recorded the largest annual rent increase since April 2025, suggesting that would-be buyers priced out of homeownership continue to support demand in the leasing segment of the market.
The divergence between a softening for-sale market and a firming rental market underscores the affordability constraints still shaping housing decisions across the country. Continue reading at Economic News, Trends, Analysis.
