AS YOUR TRUSTED REAL ESTATE ADVISOR, I HAVE VALUABLE AND UNIQUE INFORMATION ABOUT THE PULSE OF THE MARKET BASED ON REAL-TIME DATA. FOR EXAMPLE,

The housing market is coming off its strongest second quarter since 2022, but the third quarter is starting under pressure as mortgage rates move back toward their highs for the year.

This week, pending home sales dipped 0.9% below last year’s pace, one of only a few negative weekly readings we have seen in 2026. Earlier softness came around the January storms and the start of the war in March. Now, higher mortgage rates and renewed inflation concerns are testing demand again.

The broader picture is still better than last year. Year-to-date pending sales are running nearly 4% ahead of 2025, and the four-week average remains slightly positive at about 1.4% above last year. But the margin has narrowed, and the question now is whether that sales growth can hold through the second half of the year.

HERE ARE A FEW INSIGHTS THAT STOOD OUT:

The key issue is mortgage rates. Rates are in the upper 6s, and the 10-year Treasury yield has been near its highest level in a year and a half. While recent CPI data offered some relief, renewed pressure from oil prices, inflation concerns, and geopolitical risk means rates are not positioned for a dramatic decline.

That pressure is already showing up in the demand data. This week, three high-frequency indicators moved below last year’s pace: mortgage purchase applications, credit pull activity, and weekly pending sales. These data points tend to move together and provide an early read on buyer demand before traditional housing reports are released.

Inventory remains stable. There are approximately 1.09 million homes on the market nationwide, essentially unchanged from last year. Supply is not falling, but it is also not building meaningfully. Even after several years of recovery, there are still about 10% fewer homes available than in 2019 and 15% fewer than in 2017.

Home prices appear to be plateauing. The median price of newly pending single-family home sales is just over $400,000, roughly flat with last year. Asking prices remain lower, with the national median list price just under $450,000, about 2% below last year.

The more immediate signal is price reductions. More than 40% of active listings have now taken a price cut, a jump that lines up with the latest move higher in mortgage rates. When borrowing costs rise, buyers often pause quickly, and sellers respond by adjusting price.

The takeaway: The housing market improved meaningfully during the second quarter, but the recovery remains fragile. Sales are still ahead of last year on a year-to-date basis, inventory is stable, and home prices are not falling further. But if mortgage rates stay in the upper 6s or move back above 7%, demand could weaken and price reductions could rise further.

HAVE QUESTIONS ABOUT WHAT THIS MEANS FOR YOUR NEIGHBORHOOD OR YOUR HOME PLANS?

Just reach out—I’m always here to help you navigate the market with clarity and confidence.

- Shannon