M
ortgage rates have been falling, yet home‑buying activity has not surged, and a key leading indicator has slipped. Pending home sales—contracts signed before a sale—declined for the first time in almost three months, down about 1 % in the four weeks to Sept. 21 versus a year earlier, per a Redfin report. This occurs even as the weekly average mortgage rate has dropped for nine straight weeks, reaching an 11‑month low of 6.26 % after peaking at 6.8 % earlier in summer.

    Separately, the National Association of Realtors reported that existing‑home sales fell 0.2 % in August from the previous month. Although they were 1.8 % higher than a year ago, the recent trend signals a stagnant market.

    Lower rates have spurred activity in one segment: refinance applications jumped 58 % in the second week of September from the prior week, according to Redfin. Mortgage‑purchase applications rose only 3 %, and weak sales data temper expectations that cheaper borrowing will revive the market.

    Redfin cited four factors dampening demand: still‑high home prices, buyers waiting for rates to dip below 6 %, a limited supply of new listings, and broader economic uncertainty. Those hoping for further rate cuts may have missed the window, as borrowing costs have begun to climb again.

    Mortgage News Daily notes that 30‑year fixed rates were in the high 6.3 % range on Friday, unchanged from the previous week but higher than the 6.1 % range earlier in the month. Recent strong economic data have dampened expectations for aggressive Fed rate cuts, causing Treasury yields—and mortgage rates—to rebound.

    Job growth has been weaker than other indicators, adding to market gloom. Tariff uncertainty and recession fears also loom, Redfin adds. “Many buyers are hesitant because they fear job loss, stock‑portfolio erosion, and a shaky economy,” says Josh Felder, a Redfin Premier agent in San Francisco. “Those proceeding often include contingencies and are prepared to walk away during inspections if concessions aren’t met.”

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