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The housing market entering September is nearly the mirror opposite of what we saw last month. In August, completed sales remained relatively strong while forward-looking indicators weakened. This month, pending listings, homes under contract and the contract ratio have all moved above last year’s levels, while closed sales and total monthly dollar volume have fallen below where they stood one year ago.
Buyers appear to be returning slightly earlier than usual, although that increased activity has not yet translated into completed sales.
SUPPLY CONTINUES TO EASE
Active listings declined 1.6% during the month to 23,674. Days of inventory also fell to 126.0 days, compared with 127.1 last month and 133.4 one year ago.
The listing success rate improved from July’s low of 59.6% to 64.7%, meaning fewer sellers canceled or allowed their listings to expire. However, the rate remains slightly below last year’s 65.4%.
CLOSED SALES WEAKENED
Closed sales fell 13% from July to August. After accounting for August having one fewer working day, the adjusted decline was approximately 9%. Compared with August 2025, closed sales were down 5.6%, while total monthly dollar volume declined 1.4%.
This represents a noticeable change from the year-over-year sales increases recorded during the previous two months.
PRICING REMAINS SOFT
The average price per square foot declined 1.9% to $291.53, although it remains 3.8% above August 2025. The median sales price fell 1.4% to $445,500, narrowing its annual gain to just 0.7%.
Sellers received an average of 97.24% of their asking price, essentially unchanged from both last month and last year. Buyers continue to have negotiating opportunities, but properly priced and well-presented homes are still selling.
INTEREST RATES REMAIN THE KEY FACTOR
The recent increase in mortgage rates remains one of the largest factors affecting buyer demand because of its direct impact on affordability and monthly payments. This will be the major market indicator to watch throughout the next quarter and as we enter 2027.
If mortgage rates continue climbing into the 7% range, buyer demand could weaken further. That could cause available inventory to begin stacking up again, extend marketing times and place additional downward pressure on home prices.
We expect prices to remain soft through the rest of September and into October. The increase in pending and under-contract listings is encouraging, but mortgage rates and affordability will ultimately determine whether that activity develops into a meaningful recovery as we move toward 2027.
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