Buyers Are Backing Out at Record Levels — Here’s What the Data Is Telling Us
Something important is happening in the housing market — and it’s showing up first in one place:
Buyer behavior.
Across the country, buyers are walking away from deals at record levels. Not hesitating. Not negotiating harder.
Walking away.
And this isn’t a Florida story. It’s not a Texas story. It’s a national shift — showing up differently by region, but driven by the same forces everywhere.
Let’s break it down.
Buyers Are Getting Cold Feet — And It Shows Up in the Data
December closed with the highest cancellation rate we’ve ever recorded for home purchases.
Roughly 16.3% of pending sales fell out of contract — matching the prior peak from 2020 and now pushing beyond it.
That matters because cancellations aren’t just a statistic. They’re a sentiment signal.
When buyers believe prices will be lower next month, they stop acting today.
And that’s exactly what we’re seeing.
Sellers Are Rising. Buyers Are Falling.
One of the most important charts right now tracks the imbalance between sellers and buyers.
Since data tracking began in 2013, the gap between how many people want to sell and how many people want to buy is at an all-time high.
Listings are stacking month after month
Buyer demand is retreating
Inventory pressure is quietly building
When that imbalance grows, prices don’t rise — they soften.
Not overnight. But steadily.
Closed Sales Are Down — And Not Just in the Sunbelt
Let’s look at December 2025 compared to pre-COVID levels.
In my local market, Jacksonville, closed sales were down 14.7% versus 2019.
But this isn’t isolated:
Denver & Dallas: down ~32%
Des Moines: down ~26%
Maryland: down ~25%
New York, New Hampshire, Rhode Island: all meaningfully lower
Sales are slowing almost everywhere.
What differs by region is inventory — and that’s where the story splits.
Why the Northeast Looks Different (For Now)
In many Northeast markets, inventory is still lower than 2019 levels.
Why?
Because those markets:
Have far less new construction
Have zoning restrictions (and high construction costs)
Strong NIMBY culture
Meanwhile, the Sunbelt kept building to keep up with migration.
Florida, Texas, Arizona, the Carolinas — these markets absorbed historic migration and historic construction at the same time.
Now migration has slowed. In some cases, it has reversed.
But the supply is already here.
Migration Has Changed — And Housing Is Feeling It
The 2020–2021 relocation wave into the Sunbelt is over.
By 2022–2023, it stalled.
By 2024–2025, we began seeing inverse migration — people moving back to where they came from.
That shift matters because housing is local.
When population growth slows but construction continues, pressure builds.
And eventually, prices respond.
Why Are So Many Buyers Cancelling?
There’s no single reason — but the list keeps growing:
Buyers can’t sell their existing home
Inspections reveal costly repairs
Sellers refuse to negotiate
Job uncertainty is rising
Monthly payments feel unsustainable
But underneath all of it is one core issue:
Affordability has broken.
Buyers Are Applying… Then Walking Away
Mortgage purchase applications have ticked up slightly — but they’re still near historic lows.
What’s happening?
Buyers apply.
They see the payment.
They do the math.
And they walk.
Because prices are still high.
Payments are still high.
And buyers increasingly believe prices will be lower later.
That expectation alone is enough to freeze demand.
Pending Sales Are Near Record Lows
Pending home sales collapsed in 2022 — and they never recovered.
As of December 2025, they sit at record lows.
Yes, some sellers will capitulate this year.
Yes, pendings may bounce modestly.
But there’s a catch.
Many sellers “rage-quit” in 2024 — pulling listings off the market after failing to sell.
Those homes are coming back.
Which means more competition, not less.
First-Time Buyers Are Disappearing
This is one of the most concerning trends.
First-time buyers once made up ~50% of purchases.
Today, they’re closer to 20%.
The average first-time buyer is now over 40 years old.
Why?
Because affordability is gone.
You need roughly $112,000 in household income to qualify for a median-priced home.
Starting salaries are closer to $54,000.
That math doesn’t work.
FHA Buyers Are Being Pushed Out
Only about 25% of U.S. households can now qualify for a typical FHA loan — down from 47% just a few years ago.
Builders aren’t building entry-level homes at affordable price points.
Impact fees and lot costs are high.
Margins are better at higher price points.
So entry buyers are sidelined — or worse, buying at peak prices with minimal equity.
That’s not a healthy market.
Buying Costs More Than Renting (Again)
For the first time in over a decade, in many markets, it’s more expensive to own than rent in most markets.
That wasn’t true from 2014–2022 in Jacksonville.
It is true now.
When the financial incentive flips, buyer behavior follows.
Why stretch to buy when you can rent a newer unit, negotiate concessions, and wait?
That question is reshaping demand in real time.
What This Means Going Forward
Housing corrections don’t happen all at once.
They unfold slowly, locally, unevenly.
But the signals are clear:
Buyers are pulling back
Sellers are increasing
Cancellations are rising
First-time buyers are vanishing
Affordability is broken
When the math changes, psychology changes.
When psychology changes, markets change.
After a 68% increase in appreciation in Florida within a handful of years, mean reversion is now expected. Prices coming back down is a good thing. The next generation is currently locked-out of the market and I think it’s a good thing for the next generation to have a stake in the American Dream.
jon@movewithmomentum.com — Follow on X, Instagram, or YouTube.
Looking to join a tribe of top producers who are focused on service, growth, wealth building, and lifestyle?
Check out - Momentum Realty. ~$600M volume in 2025 / ~1,700 transactions closed (Florida & Georgia)
