Here’s Why Real Estate Deals Are Falling Through at Record Numbers

If it feels like more home sales are collapsing before closing this year, you’re not imagining it. I’m hearing this from agents across the country, and I’m experiencing it firsthand.

Simply put, it’s harder to get a deal to the closing table than it used to be. Even issues that once felt minor are now causing contracts to fall apart, and both nationally and locally, more deals are collapsing than we have seen in many years.

Let’s unpack what’s really behind the surge in canceled deals, and what it says about where housing stands in 2025.

1. The buyer-seller disconnect. The biggest issue in today’s housing market is a widening gap between buyers and sellers. Buyers are feeling the strain of higher prices and mortgage rates around 6%, making monthly payments feel unaffordable. Sellers, meanwhile, are still holding out for pandemic-era prices that are harder to achieve in today’s market.

Many homeowners also have ultra-low interest rates, and selling means giving that up. That limits supply and adds pressure when deals do happen. When buyers feel they are overpaying and sellers feel they are not getting enough, transactions start with tension, making them far more fragile than in the past.

2. The era of bidding wars is over. For most of 2021 and 2022, sellers had all the leverage. That’s changed.

The sale-to-list price ratio, which is a key indicator of how close homes sell to their asking price, has been falling nationwide. More homes are now selling below asking price, which signals a market shift in favor of buyers. Without bidding wars or multiple offers, sellers can’t hold out for top dollar anymore. For buyers, that means there’s finally room to negotiate, but it can also mean deals take longer to close.

With less competition in the market, buyers can take their time, make thoughtful offers, and negotiate credits for repairs, closing costs, or rate buydowns. Sellers should keep an eye on local comps. If showings are slow, a small early price adjustment can make the difference between a quick sale and weeks of waiting.

3. Seasonality and consumer behavior. This time of year always slows real estate activity. As we head into winter, school schedules, holidays, and travel naturally reduce buyer demand.

Even though mortgage rates have dipped slightly, they haven’t triggered a buyer surge. Instead, they’ve brought more sellers into the market, and that extra inventory is giving buyers more choices.

If listings continue to outpace demand, home prices could level off or soften modestly heading into winter. That’s a healthy correction for the long term, but it can be frustrating if you were expecting a fast sale.

4. Regional divide. The national numbers don’t tell the whole story. Some parts of the country, particularly in the Midwest, are showing surprising strength. Stable job growth and relatively affordable home prices allow buyers to purchase homes on a median income, which keeps demand steady and markets healthy.

Other regions, such as parts of Texas and Florida, are feeling the effects of recent overbuilding. An oversupply of homes, especially condos, new subdivisions, and some resale properties, is putting downward pressure on prices. When new construction begins and prices are cut, it impacts the entire market.

What you should do is focus on your local market data, not national headlines. Real estate is hyper-local, and what makes sense in one area might look completely different in another.

If you’re planning to buy or sell soon, don’t wait for the perfect moment – plan for it. Feel free to text, call, or email me to schedule a free, no-obligation, one-on-one consultation. Reach out to (254) 213-5335 or send an email to ryan@ryansmithhomes.com. I’ll walk through your situation, look at real numbers, and build a strategy that helps you move forward with confidence in today’s market.