Why Home Sales Fail

It’s not a common occurrence for me (maybe two to three in 22 years) but it is a common misconception in general terms that once a home is under contract, the sale is guaranteed to close. In reality, a significant number of pending transactions don't make it to closing day. Virginia REALTORS® has been tracking this phenomenon through monthly surveys, revealing that failed pending sales are a regular occurrence in the housing market. In August 2026, a notable 34% of survey respondents reported a failed pending sale, marking the highest percentage since tracking began in March 2024, and an increase from 26% in June and July of the same year.

Several key factors contribute to these deals falling through. Historically, inspection issues have been the most frequently cited problem. A home inspection can uncover significant flaws like problems with the roof, electrical system, plumbing, foundation, HVAC or water damage that weren't obvious during initial viewings. If buyers and sellers can't agree on repairs or remedies, the deal can collapse. Mortgage approval is another major hurdle; while pre-approval is a good start, final loan approval isn't guaranteed. Changes in a buyer's income, debt, credit or employment status during the loan process can lead to financing falling through.

Interestingly, a newer trend emerging in 2026 is buyers being unable to sell their current home. Many buyers rely on the proceeds from their existing property sale for a down payment or to avoid carrying two mortgages simultaneously. If their current home takes too long to sell or the sale falls through, it creates a domino effect, preventing them from proceeding with their new purchase. Other less common but impactful issues include title troubles, such as unpaid liens or ownership disputes, which can cause delays or even halt a transaction. Job loss can also be a significant factor, as a sudden change in employment or income can jeopardize mortgage qualification or make the purchase financially impractical for the buyer.

In summary, I think what stands out here is how many moving parts there are in a real estate transaction, even after an offer is accepted. The data shows that while some reasons for deals falling through are consistent, new challenges like buyers struggling to sell their current homes are becoming more prominent, highlighting the evolving complexities of the market. Like so many things in this industry, very little remains static. The idea is to know the market, know the property, gauge the likelihood of an outcome and manage expectations as new information comes in.