The housing market has experienced one of the most dramatic shifts in modern history since the pandemic. Pending home sales surged during the low-interest-rate environment of 2020–2021 before declining sharply as mortgage rates increased. The latest May 2026 data suggests the market is stabilizing, but activity remains below pre-pandemic levels.

Key Takeaways

  • Pending home sales in May increased by 3.8% month-over-month and 4.8% year-over-year.
  • Sales remain 28.4% below the pre-pandemic level of 107.2 reached in May 2019.
  • The South continues to lead the nation, posting a May 2026 index of 90.8.
  • The West remains the weakest region, with sales nearly 42% below 2019 levels.

The Midwest has shown the strongest recent recovery, rising from 72.1 in 2024 to 81.1 in 2026.

U.S. Pending Home Sales: May Trend

U.S. Pending Home Sales Index (May)

National pending home sales before and since the pandemic.

Line chart of the U.S. Pending Home Sales Index for May from 2019 to 2026. The index starts at 107.2 in 2019, dips to 100.8 in 2020, peaks at 113.7 in 2021, then drops to 98.0 in 2022, 77.1 in 2023, and 72.5 in 2024, before recovering slightly to 73.5 in 2025 and 76.9 in 2026.

What the Trend Shows

Pending home sales peaked during the pandemic housing boom in 2021. As mortgage rates rose and affordability worsened, buyer activity slowed significantly. The last two years show modest improvement, suggesting the market may be moving toward a more balanced environment.

Regional Highlights

  • South: Continues to outperform due to population growth and relatively affordable housing markets.
  • Midwest: Emerging as one of the strongest recovery stories since 2024.
  • Northeast: Showing gradual improvement but remains below national averages.
  • West: Continues to face affordability pressures that are limiting buyer activity.

How Far Regions Have Fallen Since Their Pandemic Peaks

Decline From 2021 Peak to 2026

Percentage decline in pending home sales from May 2021 highs.

Line chart comparing the Pending Home Sales Index in May for four U.S. regions from 2019 to 2026. The South stays highest throughout, peaking at 136 in 2021 and settling at 91 in 2026. The Midwest peaks at 107 in 2021, drops to 72 in 2024, and recovers to 81 in 2026. The Northeast starts at 95, dips to 63 in 2020, briefly recovers to 96 in 2021, then declines to 67 by 2026. The West peaks at 99 in 2021 and falls to 58 in 2026, the lowest of any region.

Biggest Changes Since the Boom

  • The West experienced the largest decline from its pandemic peak, dropping approximately 42%.
  • The Midwest has held up best, with a decline of roughly 24% from its 2021 high.
  • The South, while leading overall activity, remains about 34% below its peak.
  • The Northeast, which is the second most expensive region, experienced a decline of 29.6% from the top.

Outcome

The housing market in May 2026 is healthier than it was during the slowdown of 2023–2024, but it has not fully recovered from the post-pandemic correction. Buyers continue to face affordability challenges, particularly in the West and Northeast, while the South and Midwest remain the strongest regions. If mortgage rates continue to ease and inventory improves, pending home sales could continue their gradual recovery through the remainder of 2026.