Nearly one in six U.S. home purchase agreements collapsed in December 2025 as high prices and rising inventory gave buyers more leverage, according to Redfin.
By yourNEWS Media Newsroom
Homebuyers across the United States backed out of nearly 40,000 purchase agreements in December 2025, marking the highest December cancellation total since records began in 2017, according to a new analysis by Redfin.
A Redfin report released Jan. 26 found that 16.3 percent of pending home sales were canceled nationwide in December, up from 14.9 percent during the same month a year earlier. The increase reflects a housing market in which sellers increasingly outnumber buyers, giving purchasers greater leverage to walk away from deals.
“High housing costs and rising inventory have made homebuyers more selective,” said Chen Zhao, Redfin’s head of economics research. “Home sellers outnumber buyers by a record margin, meaning the buyers who are in the market have options and may walk away if they believe they can find a better or more affordable home.”
Zhao said many buyers exit contracts by invoking inspection contingencies after discovering structural problems or expensive repairs. Others, she said, reassess affordability and conclude that projected mortgage payments would be too costly.
Atlanta recorded the highest share of canceled contracts in the nation. More than 22 percent of pending home sales in the metro area fell through in December, up from 19.6 percent in November. Jacksonville, Florida, and San Antonio tied for second at 20.6 percent, followed by Cleveland at 20.2 percent and Tampa, Florida, at 19.4 percent.
“Atlanta first led the nation in cancellations in November and has quickly become a strong buyer’s market, with sellers now outnumbering buyers by over 80 percent,” the report said.
By contrast, cancellations were least common in Nassau County, New York, at 3.8 percent, as well as in California’s San Francisco metro area at 4.2 percent and San Jose at 8.9 percent.
Redfin also examined year-over-year changes and found that San Jose posted the largest annual increase in cancellations, rising nearly seven percentage points from December 2024. Oakland and Sacramento followed with increases of 6.3 points and 4.7 points, respectively.
In a separate Redfin analysis released the same day, the company reported that more than 25 percent of Gen Z adults owned a home in 2025, a 26 percent increase from the prior year. Gen Z includes Americans ages 18 to 29.
“The reality is that with housing costs still historically high, many young Americans are making compromises on location, size, or timing to get their foot in the homeownership door and start building equity,” said Redfin senior economist Asad Khan.
Redfin attributed the increase in younger buyers to a decline in average mortgage rates to about 6.2 percent from roughly 7 percent at the start of 2025, along with greater inventory and increased willingness among sellers to negotiate.
Millennials, ages 30 to 45, also saw a modest rise in homeownership, increasing to 55.4 percent from 54.9 percent in 2024. Rates for older generations remained largely stable, with Gen X homeowners at 72.7 percent and baby boomers at 79 percent.
While older Americans continue to make up the largest share of homeowners, Redfin found that younger generations accounted for a slightly larger portion of new buyers in 2025. Buyers age 60 and older represented 23 percent of home purchases last year, down from 30 percent in 2024, reflecting a gradual demographic shift in who is entering the housing market.
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