Mortgage rates hit 7.4% and pending home sales fell to their lowest since 2014. Here is what the slowdown means for buyers, sellers and Denver

Mortgage rates above 7% have started to show up in the housing data. Pending home sales, the contracts buyers sign before a deal closes, fell 4% from August to September to their lowest level since spring 2014, outside the April 2020 lockdown, according to a Redfin report released October 12, 2026. A day later, the National Association of Realtors said existing-home sales rose 1.5% in September to a seasonally adjusted annual pace of 3.99 million. NAR's chief economist warned that the increase mostly reflected deals struck before rates jumped, and that fourth-quarter closings are likely to fall.

The two reports describe the same market at two different moments. Closings in September largely came from contracts signed in July and August, when rates were in the high 6% range. New contracts signed in September reflect what buyers face now: the average 30-year fixed rate at 7.40% in Freddie Mac's October 8 survey, its highest since November 2023.

How high are mortgage rates right now?

Freddie Mac's Primary Mortgage Market Survey put the 30-year fixed rate at 7.40% for the week of October 8, up from 7.28% the week before and 6.30% a year earlier. The 15-year fixed averaged 6.73%, compared with 5.53% a year ago. As recently as September 3, the 30-year rate was 6.71%, which means it rose about 0.7 of a percentage point in five weeks. The October 8 reading marked the seventh straight weekly increase, according to Trading Economics.

The rise tracks the bond market. The 10-year Treasury yield, which mortgage rates loosely follow, was near 5.22% to 5.24% in the days before the latest survey, and the gap between mortgage rates and the 10-year was wider than usual at about 2.2 percentage points, Mortgage Daily reported. The Federal Reserve raised its benchmark rate on September 16, and the September consumer price report released October 14 showed inflation at 3.7% over the past year, which pushed yields higher again that morning.

For a sense of scale, a $400,000, 30-year loan at 7.40% carries a principal-and-interest payment of about $2,770 a month, compared with about $2,476 at last year's 6.30%. That is roughly $294 more every month for the same loan, based on a standard amortization calculation.

What the September home sales numbers showed

NAR's report showed sales at a 3.99 million annual pace, up 1.5% from a downwardly revised August but 2.2% below September 2025. The median existing-home price was $417,500, up 1.3% from a year earlier and the 39th consecutive month of annual gains, although the pace of price growth has slowed sharply.

Supply is building. Inventory rose to 1.60 million homes, up 4.6% from a year ago, equal to 4.8 months of supply at the current sales pace. The median home spent 33 days on the market, up from 31 in August. First-time buyers made up 31% of sales, and investors and second-home buyers rose to 20% from 15% in August.

NAR Chief Economist Lawrence Yun said fourth-quarter closings will clearly be down if rates stay well above 7%, according to Inman. He said August and September were the two slowest sales months of the year, and noted that delayed settlements rose to 16% of contracts from 14% in August, which he linked to buyers whose rate locks expired before closing. Only 8% of agents surveyed expect buyer traffic to rise over the next three months.

Why pending sales and cancellations matter more

Redfin's data looks further ahead. Its September report showed pending sales down 4% from August, the largest one-month drop in more than three years, and lower year over year in all 50 of the most populous metro areas. A record 14.5% of homes that went under contract in September had the deal canceled, the highest share outside the early weeks of the pandemic. Jacksonville, Tampa and Las Vegas had the highest cancellation rates.

Meanwhile, sellers are not retreating as quickly as buyers. Active listings rose 1.2% from August to the highest level since March 2020, and about one in five sellers cut their asking price. Redfin's median sale price was $393,895, up just 1.3% from a year earlier, and 60.5% of homes sold below asking. Redfin economist Chen Zhao advised sellers to "price realistically from the start," Real Estate News reported.

What it means for Denver and Colorado

The Denver metro area was already slowing before rates crossed 7%. The Denver Metro Association of Realtors reported in early October that the 11-county region closed 2,849 sales in September, down 21.4% from a year earlier and the lowest September total in records going back to 2008, ColoradoBiz reported. Active listings ended the month at 13,567, or 4.76 months of inventory, and condos and townhomes had more than seven months of supply with a median price of $365,500, down 6.3% from a year earlier. Homes still sold for about 98.5% of list price.

DMAR's report noted that most September closings reflected August contracts signed near 6.7% rates, so October and November will show the fuller effect of higher borrowing costs. Its market trends chair, Amanda Snitker, said buyers who stay active through the fall will face less competition than at any other time of year.

What homeowners, buyers and real estate businesses should do now

A slower housing market reaches well beyond agents and lenders. Remodelers, movers, title companies, home inspectors, furniture stores and landscapers all rely on transaction volume. Some practical steps based on the data:

• Buyers: Higher inventory, longer days on market and frequent price cuts give buyers more leverage than at any point in several years. Asking for seller-paid closing costs or a rate buydown can offset part of the rate increase. A lender can explain how long a rate lock lasts and what happens if a closing is delayed.
• Sellers: Redfin's data shows that overpricing tends to lead to cuts or delistings. Pricing near or slightly below recent comparable sales can avoid sitting on the market into winter.
• Homeowners staying put: With many owners holding low-rate mortgages, improving a current home may look more attractive than moving. That can sustain demand for remodeling and repair work even as sales slow.
• Housing-related businesses: Firms tied to closings may want to plan for a softer fourth quarter, as Yun suggested, and shift marketing toward homeowners rather than movers.

What to watch next

Freddie Mac's next weekly rate survey will show whether the hotter-than-expected inflation report pushed rates higher still; Mortgage News Daily's daily index rose to 7.56% on October 14. NAR's September Pending Home Sales Index is scheduled for October 20, according to its release calendar, and will offer a second view of contract signings. The Federal Reserve's October 28 rate decision will shape the bond market's direction into year-end. And in Denver, DMAR's October report, due in early November, will be the first local reading taken entirely after rates crossed 7%.