‘It’s Got To Feel Right’: Why More Homebuyers Are Walking Away From Deals

Matt and his wife thought they'd found it—the house that would become their new home in Denver. After months of virtual tours and FaceTime walk-throughs with their out-of-state real estate agent, endless hours scrolling through listings from their place in Georgia, this home, in their target neighborhood, seemed like the one. 

The couple had spent considerable time narrowing their search, flying nearly across the country twice—once in the winter to explore neighborhoods across the city, then again in the spring to understand what daily life might feel like in their top choices. This house sat in their preferred neighborhood—not quite their favorite block, but the property itself looked promising on screen. They made an offer, and it was accepted.

“Under contract on a house in Denver,” Matt texted his friends. “Closing at the end of the month and moving in December!”

Within a week of putting in their offer, they were standing in the actual house for the first time, inspection report in hand. That's when reality hit. The layout that looked workable in a virtual tour felt cramped and awkward in person. The inspection revealed issues that would require more work than they'd anticipated. 

In all, they realized they weren't excited about this house—they were just relieved to potentially have found something that worked for them. But that wasn’t reason enough to buy the place.

So they walked away. Since they were still in the early stages of the deal, they could back out without consequence. And surprisingly, their real estate agent didn't push back.

"This is a big decision," she told them. "This is where you're going to move your family. It's got to feel right."

A market where buyers can afford to be choosy

Her reaction—and Matt’s family’s ability to walk away from the deal—highlighted just how dramatically the housing market has shifted from the frenzy of 2021 and 2022. 

The couple had purchased their current home in 2018, when the market was manageable. By the COVID-19 pandemic boom years, stories were everywhere about how difficult and competitive the market had gotten. 

“People were making offers sight unseen, waiving the inspection clause—it was crazy,” he says. 

But now that Matt is looking to buy again, and in a market that recently experienced red-hot demand, he’s seeing a much different picture.

Today, buyers like him can afford to take their time— even in Denver, where supply is rapidly growing while demand falls. With lots of inventory on the market, buyers no longer have to rush to buy, and they can even back out if they’re not in love with what they originally wanted. 

Why buyers are walking away more often—and sellers are doing the same

With that said, there's now a perfect storm brewing in the housing market, where buyers and sellers alike seem unwilling to budge or compromise. For example, delistings jumped 47% nationally in May from a year earlier, a sign that sellers would rather wait than negotiate, according to Realtor.com® economic research.

Additionally, the Realtor.com August monthly housing report found that, while inventory was up, buyer activity was more subdued. Pending home sales—listings under contract—fell 1.3% year over year, down on an annual basis for the eighth consecutive month. 

This hesitancy from both sides of the transaction is creating a domino effect where deals that do get started are increasingly fragile and prone to falling apart.

"We’re seeing buyers walking away from deals more, and that’s because we’re in an environment of changing confidence," says Jacob Naig, a licensed real estate agent in Des Moines, IA. "It is not uncommon for two or three contracts to fall apart on a single listing before a property closes, something we didn’t experience as often 10 years ago."

There are many circumstances specific to a given deal that might make it fall apart, says Naig: changes in financing, surprises on inspection, shifts in personal circumstances, or a simple change of heart about long-term commitment. The Federal Reserve's recent rate cut may have persuaded some buyers to sit tight and hold out for additional reductions.

But, if you ask Matt, one major factor that is contributing to this environment is the disconnect between reality and expectations.

“A lot of people are still thinking about the value of their place as if it’s 2022,” he says. “There are places that go on the market, and it’s like, dude, this is obviously way overpriced.” 

He and his wife took notice of a home that was listed for $1.2 million. They felt that would be an overpay—and then noticed the home had originally been listed at $1.6 million. The home has languished on the market for months. 

Naig has a similar perspective: "Markets are so overheated and expectations have been stretched beyond their breaking point."

The flip side: Good homes still sell fast

With deals falling through on the rise, there is more inventory than in years past, thanks to new homebuilding, and buyers have their eyes on mortgage rates, hoping to hold off on a purchase long enough to lock in a lower rate. But that doesn’t mean finding and purchasing the home of your dreams is a walk in the park. If 20% of the deals in your area are falling apart, that means 80% of deals are still going through. 

And well-priced homes with few issues are still moving quickly. Matt and his wife learned this firsthand when they fell in love with another property just a week and a half after backing out of their first deal. They won a competitive bidding situation, only to lose out to a last-minute cash offer.

Their agent was shocked—that kind of thing "just isn't happening right now," she told them.

The lesson there is that homebuying can still be competitive, and sellers don’t need to worry as much about deals falling through, provided they play by the more normalized rules of today. 

The psychology of homebuying in 2025

The difference between today and years past is that buyers like this couple are no longer operating from a place of desperation. In 2021, walking away from a deal might have meant missing out on homeownership entirely, as inventory was so tight and competition so fierce.

Today, while Matt and his family are eager to move soon, there's a confidence that other opportunities will emerge.

"I feel very confident that there will be something on the market in our price range in the spring,” says Matt. 

That shift in psychology—from "we must get this house or we'll never find another" to "we can afford to wait for the right fit"—represents a fundamental change in the housing market's power dynamics. Buyers are no longer held hostage by scarcity.

For families like Matt's, having the luxury to be selective means ensuring one of life's biggest decisions actually feels right. The current market gives buyers room to be choosy, and sellers who can't adapt to this new reality will simply have to wait longer to find someone willing to meet their price.