February Sees Record Number of Home-Sale Cancellations

In February, more than 42,000 home-sale agreements were cancelled, according to real estate marketing platform Redfin. That number equates to approximately 13.7% of homes that went under contract that month, an increase from 12.8% a year earlier and the highest share for the month of February since 2017.

Buyer’s markets are seeing the most sales cancellations

In markets where housing inventory is higher and buyers can afford to be more selective, home-purchase agreements are being canceled at higher rates. For instance, in Tampa, Fla.—where sellers outnumber buyers by 84%—18.1% of home-purchase agreements were canceled. Likewise, 17.9% of purchase agreements were canceled in both San Antonio and in Atlanta, which are also considered buyer’s markets.

Meanwhile, popular seller’s markets are seeing far less cancellations

Not surprisingly, markets that tend to have less for-sale housing inventory are seeing fewer purchase agreements fall through. This trend is especially strong in coastal markets. San Francisco experienced the smallest share of cancellations in February at just 3.7%, followed by the Nassau County, N.Y., metro at 4.5%, and San Jose, Calif., at 5.4%.