Fresh supply is outpacing demand as mortgage rates hover near a yearly high
The US housing market entered September with the most new listings in four years, and fewer buyers willing to act on them.
New listings of US homes for sale rose 2.1% from a week earlier on a seasonally adjusted basis for the four weeks ending August 30, reaching their highest level since August 2022, according to a Redfin report.
Year over year, new listings climbed 8%. Total active listings edged up 0.4% week over week to approximately 1.51 million, nudging supply closer to the range economists associate with a balanced market.
Pending home sales, meanwhile, slipped 0.1% from the prior week to their lowest point since February, and were down 2.5% year over year.
The disconnect between rising supply and sluggish demand is the defining condition of the late-summer housing market and it is sharpening the buyer's market dynamic spreading across most of the country.
Months of supply nationally reached four, up from 3.7, approaching the four-to-five-month range that signals equilibrium.
Rates keep buyers sidelined
Affordability pressure is not easing. The average weekly 30-year fixed mortgage rate stood at 6.66% for the week ending August 27, near its highest level in more than a year, according to Freddie Mac.
The median US home-sale price rose 2.2% year over year to $398,632, translating to a monthly mortgage payment of approximately $2,592 at current rates.
The 30-year mortgage rate has been climbing toward its 2026 peak, sustaining the affordability ceiling that has restrained purchase activity throughout the summer.
Sellers are adjusting expectations. The median US asking price inched down 0.1% year over year, while 20.9% of listings carried price reductions as of August 30, up from 20.2% a year earlier.
Mortgage-purchase applications rose 2% week over week for the week ending August 28, according to the Mortgage Bankers Association (MBA), suggesting some buyers are moving despite elevated costs.
The Mortgage Bankers Association reported a modest rise in mortgage applications last week, while adjustable-rate mortgages gained popularity as higher Treasury yields pushed borrowing costs upward.https://t.co/AjND0t2YNZ
— Mortgage Professional America Magazine (@MPAMagazineUS) September 2, 2026
A market split along regional lines
National figures obscure sharp regional divergence. San Francisco posted a 9% year-over-year gain in median sale price, while Cincinnati rose 7.8% and Milwaukee climbed 7.4%. Austin, Texas fell 7.1% and Seattle dropped 6.2%.
Pending sales in Seattle declined 15.1% year over year, the steepest decline among the 50 largest US metros tracked by Redfin, while Milwaukee posted an 8.8% gain.
For brokers, rising inventory is handing buyers rare leverage in markets that once leaned firmly toward sellers.
Competition persists for well-priced homes in desirable neighborhoods: 25.9% of all sales closed above asking price during the period, up from 25% a year earlier, and the median days on market held at 45, unchanged year over year.
With home sales positioned for a second-half recovery as inventory builds, activity is likely to remain muted until borrowing costs fall far enough to draw rate-sensitive buyers off the sideline.
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