How Often Do Pending Houses Fall Through?

The journey of buying or selling a home involves several stages. A significant phase is when a property moves from “active” to “pending” status, indicating a seller has accepted an offer. While pending status suggests a high likelihood of closing, it does not guarantee a completed sale. Understanding this stage helps in navigating real estate transactions.

Understanding Pending Status

In real estate, “pending” signifies an accepted offer and that the sale is being processed. The property is generally off the active market as the buyer and seller work to finalize the transaction. While it signals progress, “pending” does not mean the sale is final.

A common variation is “pending with contingencies,” where the accepted offer is subject to certain conditions being met. These often include a satisfactory home inspection, the buyer securing mortgage financing, or the property appraising at or above the agreed-upon price. Until these contingencies are satisfied, either party may withdraw from the contract without penalty, often with the return of earnest money.

In contrast, “pending without contingencies,” or “pending, no show,” implies that all initial conditions have been met or waived. The transaction is considered on a clear path to closing. At this stage, the seller typically ceases to show the property or entertain backup offers, reflecting high confidence in the impending sale.

Common Reasons for a Pending Sale to Not Close

Even after a property reaches pending status, several issues can prevent the sale from closing. A common reason is financing issues. While initial mortgage pre-approval may be granted, final loan approval is not guaranteed. Changes in financial circumstances, such as job loss, new debt, or a decline in credit score, can jeopardize approval. Lenders scrutinize a buyer’s financial situation, and unexpected changes can lead to loan denial, preventing the buyer from meeting the mortgage contingency.

Another frequent cause for a sale to fail is home inspection findings. Most purchase agreements include an inspection contingency, allowing buyers to conduct a thorough review of the property’s condition. If the inspection reveals significant defects, such as major structural problems, severe roof damage, mold, or issues with essential systems like plumbing or electrical, buyers may request repairs or a price reduction. Should negotiations break down, or if the seller is unwilling to address concerns, the buyer can often legally terminate the contract and receive their earnest money back.

Appraisal gaps also frequently derail pending sales. When a buyer is obtaining a mortgage, the lender requires an appraisal to ensure the property’s value supports the loan amount. If the appraised value comes in lower than the agreed-upon purchase price, an “appraisal gap” occurs. In such cases, the lender will only finance up to the appraised value, leaving the buyer responsible for covering the difference in cash or renegotiating the price with the seller. If an agreement cannot be reached, and an appraisal contingency is in place, the buyer has the right to cancel the contract.

Title issues represent another potential obstacle to closing. Before a sale can be finalized, a title search is conducted to confirm clear ownership and identify any claims or encumbrances on the property. Problems such as undisclosed liens, unpaid property taxes, unresolved ownership disputes, or errors in public records can emerge, complicating the transfer of title. While many title issues can be resolved with legal assistance, complex cases might cause significant delays or even lead to the cancellation of the transaction if a clear title cannot be provided.

Less common, but impactful, are buyer or seller changes of mind. Although a signed purchase agreement is legally binding, unforeseen personal circumstances, financial concerns, or “buyer’s remorse” can lead one party to reconsider. Buyers may forfeit their earnest money deposit if they back out without a valid contingency, while sellers who withdraw without contractual provisions could face legal action. Finally, the failure of any other agreed-upon contingency can also cause a deal to fall through, such as a buyer’s current home not selling within a specified timeframe.

How Often Sales Fall Through

The frequency of pending home sales not closing varies, but industry data offers a general understanding. While most homes under contract successfully close, a notable percentage do not. Recent reports indicate that approximately 5% to 7% of pending home sales are terminated. For example, May 2025 data showed roughly 6% of pending sales were canceled, an increase from the previous year. Other reports suggest about 6% of contracts are terminated, with an additional 14% facing delays.

These percentages fluctuate based on market conditions and economic factors. Rising mortgage rates, increased affordability pressures, or stricter loan underwriting standards can contribute to more canceled contracts. For example, June 2022 saw a record high in failed deals, with approximately 14.9% of homes under contract falling through, reflecting market disruptions. In competitive seller’s markets, buyers might waive certain contingencies to make offers more appealing, which could reduce the likelihood of a deal falling through for those reasons.

The reasons for these fall-throughs are often tied to contract contingencies. Issues with buyer financing, significant home inspection findings, or a property appraising for less than the agreed-upon price are common causes. While a pending status suggests a high probability of closing, a deal can still collapse until all legal and financial requirements are finalized and the transaction officially records. Therefore, even a seemingly solid pending sale carries a risk of not reaching the closing table, influencing both buyer and seller strategies.