Why Are So Many Contracts Being Cancelled?

A record number of real estate contracts were canceled in July.

This year we had 2 contracts terminated, but in both cases, the buyers came back around and we put the deal together. I suppose that was like getting divorced, finding out you can’t do any better, and then getting re-married to your ex.

I’m going to consider us undefeated this year. Don’t jinx us!

Why are so many contracts being canceled? There are several reasons…

1. Buyers are taking in more and more information and getting advice from their family and friends.

I heard a story from a home seller that their home was under contract. Then the buyers’ parents came to visit and told the buyers they shouldn’t buy the home. The buyers cancelled the contract.
Given all the negativity in the news about the economy and the real estate market, it’s not surprising if you ask enough people, eventually someone will scare you into cancelling a contract.

2. Higher interest rates, property taxes, and insurance costs.

Many buyers get pre-qualified for a sales price but don’t always calculate what that means in terms of a monthly payment. They get a home under contract and then contact their lender to get the specifics and realize they can’t afford the payment.

3. Buyers are getting more selective.

As budgets are getting stretched, buyers are cancelling contracts over minor issues. What might not have been a big deal 2 years ago becomes a deal breaker as buyers have the expectation if they are going to push their limit, they are going to get everything they want.

4. Buyers hiring a buyer’s agent with little experience.

Agents without much experience tend not to prepare their clients for a real estate transaction from start to finish. That causes buyers to have unrealistic expectations about how things are going to work.

Buying a home can be a stressful and emotional experience, especially if you don’t have a clear understanding of the process.

5. Sellers hire the agent who tells them what they want to hear.

Many sellers want to interview several listing agents and ask each what they should do to get their home

If you plan to sell your home, now is the best time to attend our Free Home Selling Seminars. If you want to attend a workshop, contact us, and we will notify you when they are scheduled. As always, you can check KopaWorkshop.com to see the dates and times of our in-person and online Free Home Selling Seminars. For years, home sellers have told me they benefited from attending our events. Sign up at KopaSeminar.com.