The housing market is having a trust issue — and it’s getting worse.
In June 2025, nearly 17% of pending home sales were canceled, the highest rate in nearly a year. That’s not a small blip. Buyers and sellers alike are throwing up their hands and walking away from deals — and the ripple effect is starting to get real.
So What’s Happening?
Blame high mortgage rates, falling affordability, and market fatigue. When the cost of borrowing keeps climbing, a buyer who pre-qualified at 6.5% might suddenly face 7.25% — and that change adds hundreds of dollars a month.
For sellers, it’s no easier. Many are clinging to their 3% mortgage rates and finding the new math of selling one home to buy another just doesn’t work. Add to that tougher inspections and more buyers backing out after appraisals, and it’s no wonder deals are dying.
“I’ve been in real estate for over 20 years — I’ve never seen this many deals fall apart post-inspection,” says Toronto-area agent Lisa Brent.
This Isn’t Just a U.S. Problem
Canada’s housing market is showing the same cracks. According to real estate platform HouseSigma, deal cancellations in Ontario are up 30% compared to last year. And with the Bank of Canada holding rates at 5%, the pressure on affordability isn’t easing.
How It Affects Buyers
For buyers, a canceled deal can be crushing — especially after weeks of bidding and inspections. But there’s a silver lining: more canceled deals means more listings are boomeranging back onto the market.
Reddit users have called this the new game of “real estate hot potato.” Listings come back. Prices adjust. You wait for the right moment to jump in.
It might mean more chances to negotiate — especially if a seller has already tasted disappointment and just wants to close.
How It Affects Sellers
If you’re selling, brace yourself. The process could take longer, and buyers may demand more contingencies — inspection clauses, financing deadlines, appraisal buffers. You’ll need to prep your home better and price it realistically.
And if you’re trying to buy and sell simultaneously? Good luck. The timing dance has become a high-wire act.
What Should You Do?
Whether you’re buying or selling, flexibility is the name of the game right now.
- Buyers: Keep mortgage pre-approvals current, build in buffers for rate changes, and stay patient.
- Sellers: Get a pre-inspection, work with an agent who’s aggressive but honest, and be ready to adjust your price or timeline.
Final Thoughts
The surge in canceled home sales is more than just a stat — it’s a signal that the market is struggling to find balance. Until interest rates stabilize and affordability improves, expect this bumpy ride to continue.
As one Redditor put it: “Buying a house in 2025 feels like trying to play Jenga during an earthquake.”
Let’s hope the table stops shaking soon.
Marc has been involved in the Stock Market Media Industry for the last +5 years. After obtaining a college degree in engineering in France, he moved to Canada, where he created Money,eh?, a personal finance website.
