The Wall Street Journal reports that in 2025 there's been an increase in home purchases falling through. Not good.

A home purchase falling through can be expensive and inconvenient for sellers. Even catastrophic.

1. Sellers who planning to buy before selling may lose out on their new home purchase in a kind of domino effect.
2. If the deal falls through at the last minute, as happened to my colleague's transaction recently, the staged furniture has likely been removed. Staging is key to higher and better offers. To have to stage again is an expensive and time consuming proposition.
3. Home sellers usually have a holding cost such as a mortgage and insurance. If they've moved to a new place they may have double payments. Yet another expense.
4. Sellers may feel pressure to lower the listing price if the house is going back on the market, to attract a quick sale.
5. Then there's the emotional and psychological toll...you can only imagine.

You can see why a seller might try to keep the earnest money deposit (EMD) if a buyer got cold feet and dropped out at the last minute.

How a home seller backing out of a sales contract can hurt home buyers

This scenario of a seller backing out is more rare than buyers backing out. When a house is on the market, the owner usually wants to sell.

However a seller cancelling a home sale can impact buyers in a few ways:

1. Buyers who have given notice to landlords that they are moving on a certain date may find themselves Airbnbing in between the rental and home purchase as well as having to put their things in storage.
2. If the buyers have waited until they absolutely must buy, such as if they're expecting a child, not getting that dream house can be a major issue.
3. The emotional toll! You think you have found your home only to find after all the work you put into deciding, the house gets yanked away.

In all of these scenarios, the sellers and buyers might be entitled to damages depending on the contract terms.

(When my buyer clients write their offers, they are guided to use terms that limit damages they might owe to a seller.)

3 ways home sellers can increase the chance of sale success

1. Vet buyers before accepting. The seller's real estate agent (called a listing agent) should make sure the buyers are fully qualified to make the offer and learn about them from their buyer agent and lender. If a home buyer is representing themselves in a purchase, that is one less point of assurance to take their word that they are legit. That is why proof of funds, verifying identification, and going the extra mile to verify a buyer is who they say they are and are qualified is so important.
2. Be available during the contract period. Even if you are living abroad while selling property back in the U.S., the more available you can be the greater the chance of sale success.
3. Get inspections and fully disclose. In the Bay Area, it's typical for home owners to invest in as many inspection reports as possible and arm buyers with data to confidently make acceptable offers. What happens when buyers are on the hook to pay for inspection reports? I've seen this in states such as Maine where sellers are only required to fill out some short disclosures:
   • Fewer buyers make offers since they will only want to spend hundreds or thousands of dollars on reports if they are truly serious about a property.
   • With fewer buyers, there is less of the "auction" effect on the home price that many sellers enjoy in the San Francisco Bay Area.
   • Selling a home is a serious business so taking the time to think back about any issues with the property and fully disclosing those issues, as well as known activities that might be happening in the area (e.g., a hospital closing) are critical for a seller to disclose.

Buyers will be more likely to have inspection / investigation contingencies so they have time to learn all about a house. Those contingencies could be cause for cancelling, which is something sellers want to minimize.

3 ways home buyers can increase the chance of purchase success

1. Know you absolutely want the house you're writing an offer on. You may have a baby on the way. Or you might be seeing all of your friends buying houses. The pressure is on. Take the pressure off and be sure you are truly committed to the house you're buying...or at least know why you are buying it and that it is somewhere you want to live. If it's good enough for now, but not a lifer, is it in a place that will appreciate or does it have room for upgrades so you can sell it for more than you're paying?
2. Be available during the escrow timeframe. You are making one of the biggest financial decisions of your life. Now is not the time to ghost your agent. You need to be on hand to review documents, sign, and visit the property potentially. You don't want to say "I didn't know" after the deal is done. Or receive a "notice to perform" if you haven't followed the timeline.
3. Have your financing lined up.If your parent is going to swoop in and help with the downpayment or you aren't sure if you are getting the interest rate you want, work on all of this before your offer is accepted. The fewer surprises during the contract period the better. For everyone! Be sure the lender you choose is familiar with your local market and know how long it will realistically take to get the loan approved.

Conclusion: Good faith purchase offers and collaboration is key

Choosing a local agent who knows other local agents, lenders, and knows the market well is important both for buyers and sellers to succeed whether it's a buyer's market or a seller's market. Real estate transactions are a delicate balance with many points when a deal can fall apart. Our job is to help make sure that will not happen.

Success is not fully in the hands of your agent, though. Realistic goals, intensions, and actions based on the timeline on the part of the buyer and seller are key.

It is tempting for a buyer to rush to make offers if you think you might be losing your job, after which qualifying for a mortgage might be difficult to impossible.

However if you think you might lose it before closing, it's better to be straightforward with your agent and yourself about if now is the right time. Even if a layoff is in the horizon, it can still be possible to buy now. (Get in touch for more thoughts on this topic!)

Buying an ugly house you can improve or buying multi-family property, such as a duplex, where you can offset the living expenses with rental income are ways to future-proof your investment. "House hacking: with a duplex was my strategy to become a homeowner in Rockridge, and I'm happy to speak with buyer about house hacking and co-buying a property with friends or family.

Disclaimer: This was NOT written with AI at all...but the actual thoughts and opinions of this #BayArea #realestateagent Susie Wyshak. Please seek out representation from a trusted fiduciary and lawyer to guide you in your sale or home purchase. This article should not be considered legal or real estate advice.