Ryan Byrd

A Record 14.5% of Home Deals Are Falling Through: What to Do the Day Your Buyer Backs Out

When a home sale falls through, relist or reactivate right away, check whether you keep the earnest money, and ask a cash buyer for a backup offer. Redfin says 14.5% of September 2026 contracts were canceled, the highest share on record outside spring 2020.

How Common Is It for a Home Sale to Fall Through in 2026?

More common than at any point in Redfin’s records, apart from the first weeks of the pandemic. According to Redfin’s September 2026 pending sales report, 14.5% of homes under contract in September were canceled. Redfin’s buyer-and-seller report adds that the rate rose 1.2 points from a year earlier.

The sharpest cancellation rates were in the Sun Belt. Here are the highest and lowest large markets, per the Redfin press release:

Metro	September 2026 cancellation rate	Byrd and Co page
Jacksonville, FL	19.9%	Florida
Tampa, FL	18.8%	Florida
Las Vegas, NV	18.6%	Not in our service area
San Antonio, TX	18.5%	Not in our service area
Phoenix, AZ	18.4%	Arizona
San Francisco, CA (lowest)	2.8%	Not in our service area

Source: Redfin. Montgomery County, PA, was among the five markets with the lowest rates, all under 8%. Pennsylvania is one of the states we serve; see our Pennsylvania page.

The wider market explains the pressure. Pending sales fell 4% in September to their lowest level since spring 2014, excluding April 2020. Redfin’s head of economic research, Chen Zhao, said, “It’s not surprising that when rates climb above 7%, fewer people buy homes because fewer people can afford them.” Freddie Mac reported the 30-year fixed rate at 7.40% on October 15, up from 6.27% a year earlier. We covered that jump in Should You Sell Your House Now or Wait?.

Why Do Buyers Back Out of a Home Purchase?

Redfin says buyers in the strongest buyer’s market on record are more likely to walk away if the inspection is problematic, their monthly payment is not what they expected, or they simply change their mind. WRE News notes that buyers may exit during inspection or financing contingencies, and that cancellations do not necessarily signal mortgage defaults.

Buyers also have more choices. Redfin counted 1,510,784 active sellers against 928,892 active buyers in September, which means sellers outnumbered buyers by an estimated 62.6%. Active buyers fell for a fifth straight month, to the lowest level in Redfin’s records. Our guide to the 2026 buyer’s market explains what that means for sellers.

Refer and Earn: Know a neighbor whose sale just collapsed? Our Refer and Earn program pays you $500 once the sale closes, with no fees and no limit. If their sale closes with us, you earn. Refer a homeowner.

Do You Keep the Earnest Money If the Buyer Backs Out?

Often, but it depends on the contract. Redfin’s earnest money guide describes earnest money as a good-faith deposit of about 1% to 3% of the price, held in a neutral escrow account. The seller can usually keep it if the buyer cancels for a reason the contingencies do not cover.

Buyer usually gets it back: a failed inspection, a loan that does not come through, a low appraisal, or a title problem, when the contract has a matching contingency.
Seller usually keeps it: the buyer simply changes their mind, misses a deadline or waives a contingency.
Release needs both signatures: Redfin says the escrow holder releases the money once both sides sign a release or the terms are legally resolved.

Your contract and state law control the outcome, so ask your agent or a real estate attorney before you sign a release. This is general education, not legal advice.

What Should You Do the Day Your Home Sale Falls Through?

Get the cancellation in writing. Read the contract deadlines and contingency dates before you reply.
Settle the earnest money. Do not sign a release until you know who is entitled to the deposit.
Ask about backup offers. Other buyers who toured the home may still be interested.
Find out why the deal failed. An inspection issue, a financing problem or a low appraisal each call for a different fix. Ask your agent what you must disclose to the next buyer, because rules vary by state.
Reprice with real sold prices. Redfin found 60.5% of homes sold below the original asking price in September. NAR chief economist Lawrence Yun advises that “home sellers need to be realistic about local market conditions.”
Request a cash offer in parallel. It costs nothing and shows you your fallback number.

Can a Cash Buyer Rescue a Deal That Fell Through?

Yes, in many cases. A cash buyer does not need a lender to approve a loan, so the financing and appraisal delays that cancel many deals are off the table. NAR’s September 2026 existing-home sales report shows all-cash buyers made up 27% of September sales, down from 30% a year earlier, so fewer cash buyers are competing for the same homes.

	Financed buyer	Byrd and Co cash offer
Loan approval needed	Yes	No
Appraisal can lower the price	Yes	No
Repairs and showings	Often requested	None, we buy as-is
Timeline	Tied to the lender	As little as one to two weeks

With Byrd and Co, a cash sale typically works like this: you contact us, we review the home as-is, you get a no-obligation cash offer, and we close on your schedule. Read what a cash offer is and how it works or see why 1 in 4 home sales skip the mortgage.

If the failed sale left you behind on payments, act early. ATTOM’s August 2026 foreclosure report counted 5,794 completed foreclosures in August, up 42% from a year earlier. Our guides explain what happens after foreclosure and how to sell a house in foreclosure. Visit our foreclosure prevention resources too.

Refer and Earn: Do you know someone who has to sell fast after a deal collapsed, an inheritance dispute or a divorce? Our Refer and Earn program pays you $500 once the sale closes, with no fees and no limit. We make a cash offer within 24 hours. Refer a homeowner.

Has your sale fallen through? Talk to the Byrd and Co team, no pressure, just real answers. Get your no-obligation cash offer and keep your home sale falling through from costing you another month.

Frequently Asked Questions About a Home Sale Falling Through

What percentage of home sales fall through in 2026?

Redfin reports 14.5% of homes under contract in September 2026 were canceled. That is the highest share on record outside March and April 2020.

Why do home sales fall through?

Common reasons include a problematic inspection, a financing problem, a low appraisal or a buyer who changes their mind. Higher mortgage rates also push buyers to cancel when the monthly payment is higher than expected.

Can a seller keep the earnest money if the buyer backs out?

Usually yes, if the buyer cancels for a reason the contingencies do not cover. If a contingency applies, such as a failed inspection or loan denial, the buyer typically gets it back.

What should I do first when my buyer cancels?

Get the cancellation in writing and read your contract deadlines. Then settle the earnest money, ask about backup offers and decide whether to reprice.

Can I sell my house fast after a failed sale?

Yes. A cash buyer can skip the loan approval and appraisal steps that often derail financed deals, and Byrd and Co can close in as little as one to two weeks.