US Housing, October 2026: Mortgage Rates Above 2007-08, Pending Sales at a Record Low and More Mortgages Turning Late
Published: October 22, 2026
Mortgage rates are above 2007-08 levels. Unsold new homes are near their highest since 2007, and more mortgages are turning late, at the highest rate since 2015.
NAR's pending home sales index fell to 66.0 in September, the lowest since the index began in 2001. The 30-year mortgage rate is 7.40%, up 1.42 points since February.
Most owners locked in cheaper loans earlier. Over 95% of borrowers have a rate below today's, per CNBC, so selling means a costlier new mortgage. That keeps listings and sales low and helps hold prices up.
Builders: sentiment is 29, the lowest since 2012, and 43% cut prices in October. Single-family permits are the lowest since March 2023, though starts are 2.6% above a year ago.
About 483,000 new homes are unsold, near the early-2008 level, though 2% fewer than a year ago. At today's pace they would take 8.5 months to sell.
The median new home now sells for less than the median existing one, for six months in a row, though most new homes are built in the cheaper South. In 2017 it cost $74,000 more.
Late payments: the share of mortgage balances turning 90+ days late is the highest since 2015, still far below 2009.
Households: hourly pay has trailed prices for six months, job searches are taking longer and the saving rate is the lowest since 2022.
What is holding: home prices were up 1.9% year on year in July and few owners are behind. NAR's chief economist says mortgage rates could be topping out, though energy prices make that uncertain.
A few notes on the numbers
NAR's pending index starts in 2001. I rebuilt the monthly series from 2015 out of NAR's own reports, archived releases and news copies of them, and 29 of the months are NAR's first prints. The record-low call rests on NAR's own 2024 statement plus every month since.
New minus existing price is my calculation from the Census and NAR medians. They are not like for like: two-thirds of new homes sold in August were in the South, where the existing median is $366K against $428K nationally, and existing prices peak each summer. It is best read for its direction.
The mortgage gap over the 10-year uses the 10-year on Freddie Mac's survey days. It is 2.2 points now, 1.93 to 2.02 in September, against a 1998-2019 average of 1.8.
The late payment flows are from the NY Fed for Q2 2026. The 90+ flow is 1.52%, slightly above its 2003-06 average, and the 30+ flow is still below its 2003-06 level. Both are far below 2009.
Unemployment has eased to 4.2% from 4.5% last November. Pay against prices uses average hourly earnings and CPI, and weekly pay is slightly behind.
Mortgage rates are to 15 Oct. Pending sales, permits, pay and jobs are to September, new homes to August, prices to July and late payments to Q2.
My earlier analysis on this
A bond shock could spread faster, 18 Oct. Hedge funds hold a near-record share of Treasuries, much of it on borrowed money: tigzig.com/post/hedge-funds-treasuries-leverage-oct2026
IMF's manifesto of warnings, 17 Oct. Bond yields and an AI correction among the risks, and AI credit came under strain the same week: tigzig.com/post/imf-warnings-ai-credit-strain-oct2026
US consumers: the pressure is building, 12 Oct. Late payments in 2025 at 2010 levels for lower and middle incomes, per the Fed's survey: tigzig.com/post/us-consumer-pressure-late-payments-oct2026
US jobs, September 2026, 4 Oct. Fewer new jobs, longer searches, pay barely keeping up: tigzig.com/post/us-jobs-september-2026-update-oct2026
Bond markets have started acting, 25 Sep. The US 10-year closed above 5% for the first time since 2007: tigzig.com/post/bond-market-rout-sep2026
The Fed is caught, 14 Sep. Most of the 10-year rise is the real cost of money: tigzig.com/post/fed-caught-rate-decision-sep2026
NY Fed Q2 2026 household debt, 21 Aug. Mortgage and auto lates went the other way from the headline: tigzig.com/post/nyfed-household-debt-q2-2026
Other analysis at tigzig.com/analysis
US housing, October 2026: rates, sales, builders and late payments
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Slide 1
US Macro Analysis · 22 October 2026
US housing is showing cracks
Mortgage rates are above their 2007-08 levels and new homes for sale are back near them. The typical new home now costs less than an existing one. Households are stretched by longer job searches and pay that trails prices. More mortgages are falling behind, at the highest rate since 2015.
New minus existing $K. New is now cheaper +71 ’15 +74 ’18 ’21 ’24 +0 -14 2026
Mortgage rate %. Above 2008's 6.63% 2000 2010 2020 2008 high 7.40%
Pending home sales Index. Lowest since 2001 2016 2020 2024 66.0
Single-family permits K a year. Lowest since 2023 2012 2018 2024 1247K 845K
New homes for sale K. Back near early 2008 2000 2010 2020 572K 483K
90+ day flow rate %, a year. Highest since 2015 2015 2020 2025 1.55% 0.27% 1.52%
Amar Harolikar, ACA · Decision Sciences & Applied AI1 of 12tigzig.com
Slide 2
The numbers at a glance
Each measure against its 2018-19 average and a year ago
Mortgage rates are at 7.40%, the highest since November 2023. Pending home sales are the lowest since NAR's index began in 2001, and builders are the gloomiest since 2012.
Prices are still rising, and the 90+ day flow rate is the highest since 2015.
| Measure | Latest | Status | Last 3 months |
|---|---|---|---|
| Mortgage rate, 30-year | 7.40% Oct 15 | Weak | |
| Pending home sales, YoY | -11.3% Sep | Weak | |
| Existing homes sold, a year | 3.99M Sep | Weak | |
| Builder sentiment (NAHB) | 29 Oct | Weak | |
| Single-family permits | 845K Sep | Weak | |
| Single-family starts | 859K Sep | Mixed | |
| New homes sold, a year | 684K Aug | Mixed | |
| Unsold new homes, months | 8.5 Aug | Mixed | |
| Home prices, YoY | +1.9% Jul | Holding | |
| Mortgages 90+ days late | 0.99% Q2 | Mixed | |
| 90+ day flow rate, a year | 1.52% Q2 | Weak |
Status the latest reading against the 2018-19 average and a year ago: Weak worse than both, Mixed worse than one.
Last 3 months worse little change better. Holding: prices still rising. Pending sales are compared with a year ago only.
SourcesFRED (Census, Freddie Mac, S&P Cotality Case-Shiller, NAR). NAR pending sales, 20 Oct. NAHB/Wells Fargo HMI. NY Fed household debt.
Amar Harolikar · Decision Sciences & Applied AI2 of 12tigzig.com
Slide 3
Mortgage rates
Mortgage rates are up 1.42 points since February, to 7.40%
30-year mortgage rate %, weekly, since 1998. 2023 peak 7.79% 2000 2010 2020 8.64% 2.65% 7.79% 7.40%
2026, week by week Mortgage 10-year, % Jan Apr Jul Oct 5.98% 7.40%
The gap over the 10-year, a stress gauge, is widening again
Mortgage minus 10-year Points, monthly. Peaks Dec 2008 and Jun 2023. Dashed: 1998-2019 avg 2000 2010 2020 2.87 2.98 2.11
The same gap in 2026 Points, weekly. 1.81 in Jan, 2.20 now Jan Apr Jul Oct 1.81 2.20
SourcesFreddie Mac PMMS and Treasury via FRED (MORTGAGE30US, DGS10). Gap uses the 10-year on Freddie Mac's survey days.
Amar Harolikar · Decision Sciences & Applied AI3 of 12tigzig.com
Slide 4
Existing homes
Pending home sales fell to 66.0 in September, a record low for NAR's index
- ListedHomes for sale Realtor.com listings, YoY %. 1.16M in Sep
- 2018 2022 2026 -53.7% +67.2% +5.4%
Contract Pending sales NAR index, adjusted. NAR tables NAR releases 2016 2019 2022 2025 132.8 66.0
Contract Pending sales NAR, YoY %, adjusted index 2017 2020 2023 2026 -11.3%
Closed Home sales NAR existing homes, YoY %. 3.99M a year in Sep 2019 2022 2025 +48.3% -38.4% -2.2%
Every region fell year on year, the West most (15.0%). Over 95% of borrowers have a rate below today's (CNBC), so fewer owners sell. The other side: NAR's chief economist says rates could be topping out, though energy prices make that uncertain.
SourcesNAR Pending Home Sales Index (Sep 2026), history compiled from NAR reports and releases, web archives and news reports. Realtor.com via FRED (ACTLISCOUUS).
Amar Harolikar · Decision Sciences & Applied AI4 of 12tigzig.com
Slide 5
New homes: building
Builders are the gloomiest since 2012. Single-family permits are the lowest since March 2023
Builder sentiment NAHB index, 0 to 100, since 1985. Dashed: 50
- 1990 2005 2020 72 8 90 29
Single-family permits K a year, since 2010. Dashed: 2019 avg. 2005 peak 1,798K 2010 2015 2020 2025 1247K 845K
Single-family starts K a year, since 2010. Dashed: 2019 avg 889K 2010 2015 2020 2025 1273K 859K
Permits are down 32% from the January 2021 peak and 4.8% year on year. Starts are up 2.6%. Many builders are still trying to sell current projects, says Nationwide.
- 43% of builders cut prices in October, the most since at least 2020, by 6% on average. 65% used incentives.
SourcesNAHB/Wells Fargo HMI. Census via FRED (PERMIT1, HOUST1F).
Amar Harolikar · Decision Sciences & Applied AI5 of 12tigzig.com
Slide 6
New homes: unsold inventory
Unsold new homes would take 8.5 months to sell. Inventory is near its highest since 2007, and builders are cutting prices
Months' supply, new homes At the month's sales pace, since 1998. Dashed: 2018-19 avg 6.0
- 2000 2010 2020 12.2 3.3 8.5
Finished new homes for sale Inventory, K, since 1999. Dashed: 2018-19 avg 72K 2000 2010 2020 194K 128K 113K
All new homes for sale Inventory, K, since 1998. 506K in Mar 2025. Dashed: 2018-19 2000 2010 2020 572K 142K 506K 483K
New homes sold, YoY Census, 3-month average, % change. 684K a year in Aug 2012 2016 2020 2024 +43.6% -0.6%
Sales are back at their 2019 pace, with builders cutting prices; Nationwide says the cuts eat into margins. Homes for sale are 2% below a year ago, and finished homes are 113K against 191K in early 2008.
SourcesCensus via FRED (MSACSR, HNFSEPUSSA, NHFSEPCS, HSN1F). CNBC 20 Oct.
Amar Harolikar · Decision Sciences & Applied AI6 of 12tigzig.com
Slide 7
New home prices
The typical new home now costs less than an existing one
New minus existing price Median, $K, by year. 2026: Jan to Aug +71 ’15 +74 ’18 ’21 ’24 +0 -14 2026
- New vs existing price New Existing, $, monthly 2018 2020 2022 2024 2026
Median new home price $ and YoY %, since 2017 $460K $394K 2018 2022 2026 +25.8% -5.8%
The premium fell from $74K in 2017 to about zero in 2025. New cost less in 16 of the 28 months since May 2024, the last 6 in a row.
New minus existing is my calculation from the Census and NAR medians. The medians are not like for like: two-thirds of new homes sold in August were in the South, where the existing median is $366K ($428K nationally). It is best read for its direction, from +$74K in 2017 to below zero this year.
SourcesCensus via FRED (MSPNHSUS). NAR existing-home sales (Sep 2026), history compiled from NAR reports and releases, web archives and news reports. Medians not seasonally adjusted.
Amar Harolikar · Decision Sciences & Applied AI7 of 12tigzig.com
Slide 8
Home building and the economy
Residential investment is 3.6% of the economy, the smallest share since 2015. Goldman sees it falling for three quarters
Residential investment, share of GDP %, quarterly since 1947
- 1950 1970 1990 2010 7.3% 2.4% 3.6%
Goldman Sachs expects residential investment to fall 2.5%, 4% and 1% over the next three quarters, possibly more if mortgage rates do not fall. It rose in the second quarter.
Nationwide expects home building to stay weak into 2027, a modest drag on growth.
The other side: Fed officials think AI investment could offset weaker parts of the economy such as housing, per CNBC.
SourcesBEA via FRED (PRFI, GDP). CNBC 20 Oct (Goldman, Fed). CNBC 20 Oct (Nationwide).
Amar Harolikar · Decision Sciences & Applied AI8 of 12tigzig.com
Slide 9
Prices and late payments
Home prices are still rising
Home prices, YoY Case-Shiller, %, since 1988 1990 2005 2020 -12.6% +20.7% +1.9%
The same, since 2019 %. Up from 0.8% in March 2020 2022 2024 2026 +20.7% +1.9%
More mortgages are falling behind
Turning 30+ days late %, a year. Highest since 2015 2013 2019 2025 4.09% 1.39% 3.95%
90+ day flow rate %, a year. Highest since 2015 2013 2019 2025 1.55% 0.27% 1.52%
Both flows are far below 2009 (8.4% and 12.4%). Against their 2003-06 averages, the 90+ flow is just above (1.4%) and the 30+ flow is below (5.0%).
SourcesS&P Cotality via FRED (CSUSHPISA). NY Fed household debt, Q2 2026. Flows: % of mortgage balances turning late in the year.
Amar Harolikar · Decision Sciences & Applied AI9 of 12tigzig.com
Slide 10
Household budgets
Households are stretched: longer job searches, pay behind prices, less saved
Unemployment rate %. Eased from 4.5%, above 2023 2024 2025 2026 3.4% 4.5% 4.2%
Typical time out of work Median weeks. Up from 8.4 2024 2025 2026 8.4 11.5
Hourly pay minus prices YoY points. Behind for 6 months 2023 2024 2025 2026 +1.83 -0.69
Saving rate % of income. Lowest since 2022 2024 2025 2026 7.2% 4.1%
Dashed: 2018-19 average. Weekly pay fell behind again in September.
SourcesBLS and BEA via FRED (UNRATE, UEMPMED, CES0500000003, CES0500000011, CPIAUCSL, PSAVERT). No October 2025 data (government shutdown).
Amar Harolikar · Decision Sciences & Applied AI10 of 12tigzig.com
Slide 11
How the pieces fit
From permit to sale, in plain words, and who counts what
These are plain-language summaries. For the exact definitions see Census release notes, NAR methodology for pending and existing home sales, and the Realtor.com data dictionary.
New homes, built by builders
Permit▶Start▶Under construction▶Finished
Sold can happen at any stage. The Census counts a new home as sold when a deposit is taken or a sales agreement is signed, even before the permit. Homes for sale is the builders' inventory: not started, under construction or finished. Months' supply is homes for sale divided by the month's sales pace.
Existing homes, resold by owners
Listed for sale▶Contract signed▶Sale closed
NAR's pending home sales index tracks contracts signed in the month. A sale usually closes one or two months later. Homes for sale are listings on the market with no contract yet. Once a contract is signed a home leaves that count and becomes a pending sale.
Sources
Census: permits, starts, new home sales, new homes for sale and their prices.
NAR (the realtors' association): existing home sales, pending sales, existing home prices.
Realtor.com (a listings website, via FRED): homes for sale, pending listings.
NAHB/Wells Fargo: a monthly survey of builders. Freddie Mac: the weekly 30-year mortgage rate.
S&P Cotality Case-Shiller: prices of the same homes sold again. NY Fed: household debt, from Equifax credit records.
BEA: GDP, saving. BLS: jobs, pay, prices. Treasury: the 10-year yield.
SourcesCensus new residential sales release, August 2026 (24 Sep). NAR pending sales, 20 Oct.
Amar Harolikar · Decision Sciences & Applied AI11 of 12tigzig.com
Slide 12
This builds on my earlier analysis
18 OctA bond shock could spread faster Hedge funds hold a near-record share of Treasuries, much of it on borrowed money.
17 OctIMF's manifesto of warnings Bond yields and an AI correction among the risks; AI credit came under strain the same week.
12 OctUS consumers: the pressure is building Late payments at 2010 levels for lower and middle incomes; new mortgage lates still rising.
4 OctUS jobs, September 2026 Fewer new jobs, longer searches, pay barely keeping up.
25 SepBond markets have started acting The US 10-year closed above 5% for the first time since 2007.
14 SepThe Fed is caught Most of the 10-year rise is the real cost of money, and a rate rise does not reach oil.
31 AugA correction in AI valuations is looking more likely A central bank, an asset manager and a bond investor make the case, in a 20-page deck.
21 AugNY Fed Q2 2026 household debt Mortgage and auto lates went the other way from the headline.
Not investment advice. This is my analysis of public sources, for information only. Care has been taken, but errors are possible. Use of AI. Parts of this work were prepared with AI under my direction. I reviewed, edited and approved every page. The analysis and conclusions are mine.
Amar Harolikar · Decision Sciences & Applied AI12 of 12tigzig.com
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