Contracts and existing-home sales finally showed a flicker of life—nudging upward as mortgage rates hit their lowest point in 13 months. On paper, that sounds like momentum. But below the surface, the market is tense, picky, and emotionally exhausted.
Yes, buyers are writing offers again, but it’s coming with an asterisk: they’re not afraid to walk away. According to Redfin, 15% of home purchase contracts fell through in September—the highest share in almost a year. That's nearly 1 in 6 accepted offers never made it to closing. Why? Buyers are tip-toeing into the market, then getting cold feet once reality hits.
During the pandemic frenzy, buyers waived everything—inspections, repairs, timelines, logic, and sometimes dignity—just to win. That era is long gone. The emotional tone has shifted from “I’ll take anything” to “prove this home is worth it.” Simply put: buyers have more leverage than in recent years, and they're using it.
And honestly? Who can blame them. Buyers see opportunity—but they also see risk. They’re cautious, calculated, and quick to pump the brakes the moment doubt creeps in. What else is on their minds? Economic woes. From job market uncertainty, rising consumer debt, inflation fatigue, the economy (in general), and the fear of "catching a falling knife" on prices.
Home prices may have plateaued but they still remain high meaning sellers aren't feeling the heat either. Sellers don't need to sell where most current homeowners are locked into low 2–4% interest rates. That “golden-handcuff mortgage” makes moving financially painful. So unless they’re relocating, divorcing, or running out of space, many would rather wait than negotiate.
We’ve entered a stalemate market: two sides that won't budge leaving offers to collapse during inspection negotiations.
Here's my take on things:
This isn’t a buyer’s market or a seller’s market. It’s a “prove it” market. Buyers are demanding value. Sellers are holding their ground. And the agents who will thrive in this climate are the ones who can navigate expectation gaps, manage emotions, and keep deals alive without letting them blow up in inspection round two.
*Of the last two months of transactions, 20% of our transactions have fallen apart after contract*
Read more at WSJ's article, "More Home Purchases Are Falling Through in an Uncertain Economy"
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Adam Pretorius is a top-producing luxury real estate agent in Iowa City. Follow for more real estate insights and news.
