This January, 41,000 home purchase agreements were canceled, accounting for 14.3% (1 in 7) of pending sales, according to a new Redfin report. This marks an increase from 13.4% in January 2024 and is the highest cancellation rate for this time of year since at least 2017.
The trend reflects a buyers’ market driven by rising inventory, declining demand, economic uncertainty, and elevated mortgage rates. Many buyers are backing out before closing.
Atlanta led the nation in cancellations (19.8%), followed by Orlando (18.2%), Las Vegas (17.9%), Houston (17.8%), and Jacksonville (17.8%).
While high, the rate remains below the pandemic-era peak of 16.4% in March 2020. Meanwhile, the National Association of Realtors reported a 4.6% drop in its Pending Home Sales Index (PHSI) in January, hitting an all-time low of 70.6. Year-over-year, pending sales declined 5.2%.
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