The latest Pending Home Sales YoY figure for the US, released on November 25, 2025, shows a -0.40% decline, improving from October’s -0.90% and surpassing the -2.40% estimate according to the Sigmanomics database. This marks the smallest contraction since April 2025, when sales were down 0.60%. The data reflects ongoing challenges in the housing sector but suggests a tentative bottoming out after a volatile year.

Drivers this month

• Mortgage rates remain elevated near 7%, dampening affordability but stabilizing compared to earlier spikes.
• Regional strength in the South (1.20% YoY) and West (0.80% YoY) contrasts with continued weakness in the Northeast (-2.10% YoY).
• Inventory constraints persist, limiting supply-side pressures but supporting prices.

Policy pulse

The reading sits just above the Fed’s neutral zone for housing activity, reflecting the lagged impact of monetary tightening. The Federal Reserve’s ongoing rate hikes have cooled demand but have not yet triggered a sharp downturn in pending sales.

Market lens

Immediate reaction: US Treasury 2-year yields dipped 5 basis points post-release, while the USD Index softened by 0.15%. Equity markets showed mild gains in homebuilder stocks, signaling relief at the smaller-than-expected contraction.

Pending Home Sales are a leading indicator of existing home sales and broader housing market health. The November print’s -0.40% YoY decline contrasts with a sharper -5.00% contraction in January 2025 and a -3.60% drop in March, highlighting a gradual recovery trend. The 12-month average stands at -1.70%, underscoring persistent softness but improving momentum.

Monetary Policy & Financial Conditions

The Federal Reserve’s tightening cycle, with the federal funds rate now at 5.50%, has increased mortgage rates to near 7%. This has constrained buyer affordability and slowed sales. However, recent signals of a potential pause in rate hikes have eased financial conditions slightly, supporting housing demand.

Fiscal Policy & Government Budget

Federal fiscal policy remains largely neutral, with no major housing stimulus enacted in 2025. State-level incentives in some regions have helped sustain demand, but overall government spending has not materially shifted housing dynamics.

External Shocks & Geopolitical Risks

Global uncertainties, including supply chain disruptions and geopolitical tensions in Eastern Europe and the South China Sea, have indirectly pressured consumer confidence. These risks contribute to cautious buyer behavior despite stable employment and wage growth.

Comparing the current print with the first half of 2025 reveals a marked shift. Early 2025 saw steep declines, with January and February posting -5.00% and -5.20%, respectively. The rebound in June (1.10%) and September (3.80%) hinted at recovery phases, though October’s dip to -0.90% suggested volatility. November’s improvement to -0.40% may indicate stabilization.

Market lens

Immediate reaction: Following the release, the US Dollar Index softened by 0.15%, reflecting reduced safe-haven demand. The 2-year Treasury yield fell 5 basis points, signaling eased expectations for further aggressive Fed hikes. Homebuilder stocks such as PHM rallied modestly, reflecting optimism on housing demand.

Looking ahead, the Pending Home Sales trajectory depends heavily on monetary policy, economic growth, and consumer sentiment. The Fed’s next moves on interest rates will be pivotal. A pause or cut could boost affordability and sales, while further hikes risk deepening the contraction.

Bullish scenario (25% probability)

• Fed signals rate pause or cut by Q2 2026.
• Mortgage rates decline below 6.50%, spurring buyer activity.
• Pending Home Sales turn positive YoY by mid-2026, supporting housing-related equities.

Base scenario (50% probability)

• Fed maintains current rates through 2026.
• Mortgage rates hover near 7%, limiting affordability.
• Pending Home Sales remain flat to slightly negative (-0.50% to 0%) through 2026.

Bearish scenario (25% probability)

• Fed resumes hikes amid inflation resurgence.
• Mortgage rates rise above 7.50%, further dampening demand.
• Pending Home Sales contract more sharply (-2% or worse), pressuring housing stocks and consumer spending.

Structural trends such as demographic shifts and urbanization continue to support long-term housing demand, but affordability constraints and supply shortages remain key challenges. Fiscal policy adjustments or new housing incentives could alter this outlook.

The November 2025 Pending Home Sales YoY data from the Sigmanomics database reveals a housing market cautiously emerging from contraction. While the -0.40% decline is an improvement, the sector remains vulnerable to monetary tightening and external shocks. Investors and policymakers should monitor mortgage rates, Fed guidance, and regional disparities closely. The balance of risks suggests a slow recovery with potential volatility ahead.

Key to watch will be the interplay between financial conditions and consumer confidence, as well as any fiscal interventions. The housing market’s health will continue to be a bellwether for broader economic stability in the US.

Key Markets Likely to React to Pending Home Sales YoY

Pending Home Sales data often influences markets tied to housing and interest rates. Key symbols historically correlated include homebuilder stocks, mortgage REITs, and interest rate-sensitive currencies. These assets react to shifts in housing demand and monetary policy expectations.

• PHM – PulteGroup, a leading homebuilder, is sensitive to housing demand trends.
• DHI – D.R. Horton, another major builder, tracks housing market momentum closely.
• USDCAD – The USD/CAD currency pair reacts to US economic data and interest rate differentials affecting housing finance.
• BTCUSD – Bitcoin often moves inversely to risk-off sentiment triggered by housing market weakness.
• ITB – The iShares Home Construction ETF tracks homebuilder stocks and is sensitive to housing data.

Insight: Pending Home Sales YoY vs. PHM Stock Price Since 2020

Since 2020, PHM stock price movements have closely mirrored Pending Home Sales trends. Periods of contraction in sales, such as early 2025’s -5% YoY drop, corresponded with PHM declines of over 15%. Conversely, rebounds in sales, notably in mid-2025, aligned with PHM gains exceeding 10%. This correlation underscores PHM’s sensitivity to housing market health and interest rate shifts, making it a valuable barometer for investors tracking Pending Home Sales data.

FAQs

What does the Pending Home Sales YoY figure indicate?

The Pending Home Sales YoY measures the annual change in contracts signed for home purchases, signaling future existing home sales trends and housing market health.

How does the Pending Home Sales YoY affect the US economy?

It impacts consumer spending, construction activity, and financial markets, as housing is a major economic sector sensitive to interest rates and policy changes.

Why is the Pending Home Sales YoY important for investors?

Investors use it to gauge housing demand, anticipate Fed policy moves, and adjust exposure to homebuilders, mortgage REITs, and related sectors.

Final Takeaway: November’s modest contraction in Pending Home Sales suggests the US housing market is stabilizing amid high rates and economic uncertainty. The path forward depends on monetary policy and consumer resilience, with risks balanced between slow recovery and renewed weakness.

This has been drafted with AI assistance and then thoroughly reviewed, refined, and approved by our human editorial team to ensure accuracy, and originality.

Updated 11/25/25