Buyers are walking away from contracts

In the month of June, 15% of contracts fell through. Here are a few reasons why buyers are walking away or changing their minds about purchasing a home:

1. Home Inspection Contingencies- Buyers are including these in their offers so they have a way out if the inspection reveals problems they don’t want to take on

2. Appraisal Contingencies- If the appraisal is lower than the agreed-upon sale price, the buyer can walk away and get their earnest money/deposit back.

3. Finance contingencies are being included in offers again so if a buyer isn’t able to secure a mortgage rate once under contract, he/she can terminate the contract without losing their earnest money.

The last couple of years buyers were waiving these contingencies so it was less likely for potential buyers to back out of contracts, but with these contingencies coming back we all need to reframe our expectations whether selling or buying.

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