Pending Home Sales Hit a Record Low — and the Opening It Creates for Prepared Buyers

The fall housing market just posted a number worth paying attention to. Pending home sales — signed contracts on existing homes, the best early signal of where closings are headed — fell 7.3 percent in September from August, and more than 11 percent from a year earlier, according to the National Association of Realtors. By some measures, contract signings dropped to the lowest level ever recorded.

That sounds like bad news, full stop. For buyers and sellers in Michigan, it is more useful than that: a slowdown like this one reshuffles who has leverage, and it rewards the people who are prepared while everyone else waits.

How we got here

The September slump has a clear cause. Mortgage rates surged through the month — from around 6.9 percent at the start of September to as high as 7.6 percent on some daily measures, with Freddie Mac’s weekly average touching 7.40 percent by mid-October, its highest since November 2023. Buyers who were already stretched on affordability stepped back, all at once.

Builders felt it too: housing starts fell 5.2 percent in September. And existing homeowners, most of whom hold mortgages at 5 percent or below, had one more reason to stay where they are.

The result is a market moving in slow motion — but slow motion is not the same as standing still. Homes are still selling every day in Ann Arbor and across Southeast Michigan. They are just selling to buyers who can carry today’s payments, at prices sellers have had to think harder about.

The three shifts hiding inside the slowdown

1. Inventory is rebuilding. Active listings nationally rose about 5 percent year over year by the end of September, and new data shows homes for sale up 7.7 percent year over year in the most recent weekly reading — the fastest inventory growth since January. In Ann Arbor, there are roughly 23 percent more homes for sale than a year ago. More choice means less panic-buying and fewer bidding wars.

2. Price cuts are becoming normal. Roughly three in ten listings nationally — and about 31 percent of Ann Arbor listings — have taken a price reduction. A year or two ago a price cut signaled a problem home. Today it usually signals a seller who launched at last year’s price and is meeting the market. For buyers, a cut is an invitation: that seller is motivated and negotiating.

3. Closed prices are holding up better than asking prices. While asking prices get trimmed, actual sale prices nationally are roughly flat to slightly up year over year, and Michigan’s statewide median sale price rose 3.3 percent in September to $289,069. Sellers are giving up the price they hoped for, not the value they hold. That distinction is exactly where deals are being made right now.

The opening for buyers

Fewer signed contracts means fewer competing buyers — and fall and winter amplify the effect, because the casual shoppers disappear until spring. If you are pre-approved and your job and life situation are stable, this season offers a combination that rarely lasts:

• Homes sitting 30 or more days, where sellers expect to negotiate
• Sellers willing to discuss concessions — rate buydowns, closing-cost help, repairs — that were unthinkable in 2022
• Time to actually inspect, compare, and think, instead of deciding in a driveway

The discipline is to buy based on the payment you can carry today, not on a guess that rates will rescue you next year. If rates fall later, refinancing is a bonus. If they do not, you still own a home you chose carefully at a negotiated price.

The playbook for sellers

A record-low pending-sales print does not mean your home cannot sell. It means the buyers who remain are serious, financed, and comparing you against more options than they had last year. Homes that sell in this environment share a pattern:

• Priced from real comparables, not aspirations — the first two weeks are when your listing is news; after that, it is background
• Prepared before launch — clean, decluttered, photographed properly, minor repairs done
• Flexible on terms — a buydown contribution or a flexible closing date can beat a small price cut in a buyer’s monthly math

Sellers who adapt are still getting strong results. Sellers who hold out for a market that has already changed are the ones funding the statistics above.

The bottom line

Slow markets feel uncomfortable, but they are where smart moves happen. Buyers get choice and negotiating power. Sellers who price and prepare honestly still sell well. The people who get hurt in a market like this are the ones waiting for it to become a different market.

If you are thinking about buying or selling in Ann Arbor, Canton, Plymouth, Ypsilanti, Novi, or anywhere in Southeast Michigan this fall or winter, get a clear, current read on your position first. Call or text IKL Real Estate at 734-926-9444 — we will look at the real numbers for your street and your budget, and tell you honestly whether now is your moment.

Sources: National Association of Realtors pending home sales data (September 2026); Freddie Mac Primary Mortgage Market Survey (week ending October 22, 2026); U.S. Census Bureau housing starts (September 2026); Redfin and Realtor.com market data (September–October 2026).