Pending Sales Just Hit a Record Low. Here's How an Investor Turns That Into an Offer Price.

Fewer people signed a contract on a home in September 2026 than in any month since the National Association of Realtors started counting in 2001. In the same weeks, Redfin found more sellers per buyer than at any point in its records.

That is real leverage. Most of the people who could bid against you, retail and investor, have stopped.

But the rate jump that emptied the market also shrank what a rental's rent can carry. A deal that worked in August at a given price may not work now at the same price.

The edge in this market isn't that sellers are desperate. It's that a DSCR buyer can compute an exact walk-away price from the rent. In a market this thin, a disciplined number gets taken seriously.

To have Dominick Prevete price a deal like this one, call or text him at (908) 220-6404 — he takes these calls himself — or request written terms with the Instant Term Sheet.

Two records in one week

NAR's Pending Home Sales Index fell 7.3% in September 2026 to 66.0, the lowest reading since the series began in 2001. It was down 11.3% from a year earlier, and all four regions fell. That's from NAR's October 20, 2026 release. Economists polled by Reuters had expected a decline of about half a percent. NAR's chief economist, Lawrence Yun, put it on fast-rising mortgage rates.

The Northeast index was 59.0 in September 2026, down 4.2% for the month, the smallest monthly decline of the four regions. Smaller, not small.

Redfin found that 41 of the 50 most populous U.S. metros were buyer's markets in September 2026, the most in its records back to 2013. Redfin calls a metro a buyer's market when sellers outnumber buyers by more than 10%, and a seller's market when there are more than 10% fewer sellers than buyers. Nationally, sellers outnumbered buyers by 62.6%, the widest gap in Redfin's records. That's from Redfin's report published October 14, 2026.

Redfin estimated 928,892 homebuyers in the U.S. market in September 2026, the fewest in its records back to 2013, against 1,510,784 sellers, the most since March 2020. The seller count didn't jump because of a wave of new listings. Homes are sitting.

One count to keep straight. Realtor.com's Market Clock, released October 19, 2026, rates only 17 of 99 metros as buyer's markets. It measures differently. When you see "41," it is Redfin's figure, and the denominator is Redfin's 50 largest metros.

It isn't only retail buyers sitting out. Redfin reported on May 28, 2026 that investor home purchases fell 6% year over year in the first quarter of 2026, to their lowest level since 2020. Investors bought 19% of the homes that sold. Most of the people who could compete with you for a rental have stopped bidding.

The leverage and the math are moving in opposite directions

Here's the part the "buyer's market" headlines skip.

Freddie Mac's 30-year fixed average rose from 6.66% in late August to 7.40% on October 8, 2026, a 74 basis point move, per Realtor.com's October 19 Market Clock. Realtor.com calculated that the move cut purchasing power 7.2% for a buyer with a fixed $2,000 monthly principal-and-interest budget. The average held at 7.40% on October 15 and eased to 7.32% in Freddie Mac's survey released October 22, 2026, still 66 basis points above late August.

Two cautions on that number. Freddie Mac's survey tracks conventional, conforming home-purchase loans for borrowers who put 20% down and have excellent credit. A DSCR loan on a rental is priced separately, on its own sheets, and doesn't move in lockstep with it. What the survey tells you is the direction and the size of the market move.

Prices haven't caught up. Redfin reported that home-sale prices in its buyer's markets were still up about 1% year over year in August 2026, against an average of 6.4% across the five seller's markets. Prices flattened. They didn't fall.

So leverage went up and the rent's buying power went down, at the same time. A deal that penciled in August at $325,000 may not pencil now at $325,000. The question for every offer is no longer "how much can I get off?" It's "what's the most this rent can pay for?"

Work backward from the rent

The method, in one sentence: maximum offer = ((rent ÷ target DSCR) − monthly taxes and insurance) ÷ the loan's monthly payment per dollar ÷ LTV.

That's the whole tool. The rent sets the payment you can carry. The payment sets the loan. The loan and your down payment set the price. The list price never enters it. (Why the list price is the seller's number and not yours is the subject of the cap rate vs. DSCR post.)

Dominick Prevete runs this calculation on every purchase he arranges before an offer goes in. Here it is on one file.

The inputs

Every property input below is illustrative. Taxes and insurance are deliberately state-agnostic.

DSCR here is gross rent ÷ PITIA, the same convention as every other DSCR post on this site. The rent is the figure the lender will use, which is not always the lease; the lease vs. market rent post covers when the two disagree.

Why 1.25: on two of the three wholesale sheets behind the DSCR ratio post (dated October 5, 2026), 1.25 earns a modest price improvement over 1.00 to 1.24. It isn't a leverage tier. It's a cushion that also prices a little better. That post has the figures.

At 7.125% over 30 years, each dollar of loan costs 0.0067372 a month in principal and interest.

Step 1: The deal at full list

At list, the deal clears 1.20. That's a loan. It isn't 1.25.

Step 2: The maximum offer at 1.25

On an illustrative $325,000 rental renting for $2,700, the most you can pay and still hit 1.25 coverage at an illustrative 7.125% is $308,734, which is $16,266, or 5.0%, under list.

Step 3: The offer

Round down to $308,000. The loan is $231,000, principal and interest $1,556.29, PITIA $2,156.29, and the DSCR is 1.25. Down payment: $77,000, against $81,250 at list.

That number is the offer. Above it, you walk.

What 25 basis points costs you at the table

Same rent, same taxes and insurance, same 75% LTV, same 1.25 target. Only the rate moves.

At an illustrative 7.125% DSCR rate, each 25 basis point increase cuts the maximum offer by about 2.5% at constant coverage, and a 74 basis point move cuts it by about 7.0%.

That 7.0% sits right next to Realtor.com's 7.2% purchasing-power figure, and it isn't a coincidence. Once the rent, taxes, insurance and coverage target are fixed, the maximum loan moves exactly with the payment per dollar. Realtor.com started from 6.66%; this example starts from 7.125%. Same arithmetic, slightly different starting point.

Here's what that means for this deal. The negotiation was worth 5.0%. One 25 basis point move takes back about half of it.

Most investors model the discount. Few model the rate. If you're negotiating for three weeks while the rate moves against you, you can win the price and lose the deal. The bridge-to-DSCR refinance post traces the same squeeze on the exit side.

The part that doesn't travel: North Jersey is a seller's market

This is where the national story stops working for a lot of the people reading this.

Redfin classified the Newark, NJ metro division as one of only five seller's markets among the 50 largest U.S. metros in September 2026, with 18.5% fewer sellers than buyers. Under the federal government's current metro delineation, that division includes Essex, Hunterdon, Morris, Sussex and Union counties. Sparta, where my office is, sits in it.

The price cuts say the same thing. In the four weeks ending September 20, 2026, 21.1% of U.S. sellers cut their asking price, the highest share for that time of year in Redfin's records back to 2022. In the Newark metro the share was 12.2%, the second-lowest of the 50 metros Redfin tracks. That's from Redfin's report published September 30, 2026.

The neighbors are different markets. Redfin rated the New York, NY metro a buyer's market in September 2026, with 17.6% more sellers than buyers. Bergen, Hudson and Passaic counties sit in that metro division, not Newark's. The division Redfin labels New Brunswick, NJ was balanced, with 0.6% fewer sellers than buyers.

Two honest readings follow.

The method doesn't change at home. The yes rate does. In Sussex or Morris County, a seller with one or two offers in hand is less likely to take $16,000 off. That makes the walk-away number more important here, not less. When you can't win on price, the only protection you have is knowing exactly where to stop.

A two-hour drive changes the leverage. Redfin rated Philadelphia a buyer's market in September 2026 with 56.4% more sellers than buyers, and Pittsburgh at 61.6%. Even inside Pennsylvania it isn't uniform: Montgomery County, PA, Philadelphia's suburban division, was a seller's market at 22.7% fewer sellers than buyers. If you want to see what a Pennsylvania deal looks like traced line by line, the Scranton post walks through one. Scranton isn't in Redfin's 50, so read it as a Pennsylvania deal traced, not as evidence about Scranton's market. The Pennsylvania DSCR loan page has the state-level picture, and the New Jersey DSCR loan page has the home-state one.

When the seller won't move on price

Sometimes the seller won't cut, but will write a credit. The concession post traces how to spend that credit, a price cut against a seller-paid buydown, on a full deal.

One point that post didn't make: in a seller's market like Newark, a credit is often the only concession on the table. That makes its math more useful at home than in Pittsburgh, where the price itself is moving.

The honest risk

Record-low signings lead closings by one to two months, per NAR. Prices could soften further from here, and waiting has real option value. I'm not going to pretend otherwise.

But two things cut the other way. A DSCR buyer's ceiling is set by the rent, not by where prices are heading. If the rent supports $308,734, a lower price later is a bonus, not a requirement. And the rate could fall or rise while you wait. The table above shows how fast a rise eats a discount.

I'm not predicting rates. The disciplined position doesn't need a prediction: make offers only at the computed number, walk away above it, and don't try to time the bottom.

FAQ

Is it a buyer's market right now? In most of the country, yes. Redfin found that 41 of the 50 most populous U.S. metros were buyer's markets in September 2026, the most in its records back to 2013, with sellers outnumbering buyers by 62.6% nationally (Redfin, October 14, 2026). The five exceptions were seller's markets: Nassau County, NY; Montgomery County, PA; Newark, NJ; Milwaukee; and San Francisco.

What does a record-low pending home sales number mean for investors? Fewer competing offers now. NAR's Pending Home Sales Index fell 7.3% in September 2026 to 66.0, the lowest reading since the series began in 2001, and was down 11.3% from a year earlier (NAR, October 20, 2026). Contract signings lead closings by one to two months, so the closings that follow from those signings will show up in October and November data.

How do I calculate the most I can offer on a rental with a DSCR loan? Work backward from the rent: divide the rent by your target DSCR, subtract monthly taxes and insurance, divide by the loan's monthly payment per dollar, then divide by the LTV. On an illustrative $325,000 listing renting for $2,700 a month, with $600 of taxes and insurance, 75% LTV and an illustrative 7.125% 30-year fixed rate, the most you can pay and still hit 1.25 coverage is $308,734, about 5% under list. Dominick Prevete runs this calculation on every purchase he arranges before an offer goes in.

Is North Jersey a buyer's market? No. Redfin classified the Newark, NJ metro division, which includes Essex, Hunterdon, Morris, Sussex and Union counties, as a seller's market in September 2026, with 18.5% fewer sellers than buyers. Only 12.2% of Newark-area sellers cut their price in the four weeks ending September 20, 2026, the second-lowest share of the 50 metros Redfin tracks. Across the river, the New York, NY metro was a buyer's market, with 17.6% more sellers than buyers.

How much does a rate increase reduce what I can pay? About 2.5% of your maximum offer for every 25 basis points, at an illustrative 7.125% DSCR rate, holding the rent, taxes, insurance, LTV and 1.25 coverage constant. A 74 basis point move, the size of the rise in Freddie Mac's 30-year average from late August to October 8, 2026, takes about 7.0% off the maximum offer.

Should I wait for prices to fall further before buying? Waiting has real option value: pending sales lead closings by one to two months, so prices could soften further. But a DSCR buyer's ceiling is set by the rent, not by the price trend, and the rate can move against you while you wait. The disciplined position is to offer at the number the rent supports, walk away above it, and not try to time the bottom.

Send the listing

Send me the address, the list price, the rent (the lease if there is one) and the tax bill. I'll work it back to the number the rent supports, at today's pricing, before you write the offer. Current DSCR pricing is on the rates page, and you can run your own coverage in the DSCR calculator.

Dominick Prevete — 31+ years in real estate finance. Founder, National Loan Provider. 25 Main Street, Unit B, Sparta NJ.

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