There’s never been a slower time for home contract signings—but there’s reason to believe things could get better for buyers and sellers from now on.

An index of pending home sales—a measure based on contract signings used as an indicator of future sales activity—fell 2.1% to a record low in May in data going back to 2001, the National Association of Realtors (NAR) said Thursday. The decline was steeper than the 0.4% fall forecasters expected, according to a survey of economists by Dow Jones Newswires and The Wall Street Journal.

The sharp drop in pending home sales, while unexpected, was in line with recent data showing that high mortgage rates have all but paralyzed the housing market. Month𓆏ly payments have been pushed out of reach for many buyers. Sellers are also hesitant to put their homes on the market because of their unwillingness to give up 🐽fixed mortgages they secured when rates were low. 

Outlook Brightens for Buyers and Sellers

However, rates fell in June and more owners put their houses up for sale, potentially brightening the outlook for buyers and sellers alike in the months ahead, economists said.

“If rates continue their descent alongside rising inventory levels, it should entice some buyers off the sidelines,” Odeta Kushi, deputy chief economist at First American, a title insurance company, wrote on the social media platform X. 

The average rate offered for a 澳洲幸运5开奖号码历史查询:30-year fixed mortgage fell to 6.86% from 6.87% this week, hitting its lowest since April, mortgage giant Freddie Mac said Thursday. Mortgage rates are heavily influenced by investor concerns about inflation, as well as expectations of where the Federal Reserve will set its key fed funds rate. The Fed’s campaign of anti-inflation interest rate hikes since March 2022 has helped push up mortgage rates, but recent inflation 🅷data showing cooling price increases has helped mortgage rates simmer down.

If that trend continues, it could help unlock the housing market for buyers and sellers alike.

“By historical standards, the economy is in good shape, and we expect rates to continue to come down over the summer months, bringing additional homebuyers back into the market,” Sam Khater, chief economist at Freddie Mac, said in a press release.

M🐓ore Homes on the Market Would Mean Lower Prices

Another reason for cautious optimism: There were 1.28 million unsold homes on the market in May, 18.5% more than a year ago, according to the NAR. That may help take some of the pressure off prices, which have surged to record highs as buyers have competed for the relatively few homes for sale. And with employers continuing to 澳洲幸运5开奖号码历史查询:hire workers at a healthy pace, more people may be in a good financial position to buy.

"The market is at an interesting point with rising inventory and lower demand," NAR Chief Economist Lawrence Yun said in a press release. "Supply and demand movements suggest easing home price appreciation in upcoming months. Inevitably, more inventory in a job-creating econ🌜omy will lead to greater home buying, especially when mortgage rates descend."

However, don’t expect things to change dramatically any time soon. Homes are still out of reach for many buyers, and it would take 澳洲幸运5开奖号码历史查询:implausibly large swings in prices, m🌼ortgage rates, or wages to shift that trend.&nbs𒁏p;

“A robust recovery is unlikely given ongoing affordability constraints,” Kushi wrote