Metro Atlanta homebuyers are backing out of contracts. Here’s why.

With an influx of listings on the market, more metro Atlanta homebuyers are backing out of contracts.

Almost 17% of pending home sales fell apart in December, according to data from the Georgia Multiple Listing Service for the 12-county region.

At the end of the month, 3,254 homes were under contract in metro Atlanta, down almost 25% from the same month a year ago. Pending home sales offer a forward look at the housing market, as signed contracts typically close in one or two months.

Still, experts are hopeful lower mortgage rates will nudge more buyers off the sidelines in 2026.

“My gut is that 2026 will be a bit of a comeback year for real estate,” said Kristen Jones, broker and owner with Re/Max Around Atlanta. “A lot of buyers and sellers have been sitting on the fence for different reasons.”

A home for sale in Roswell on Monday, Dec. 22, 2025. (Natrice Miller/AJC)

Atlanta recently led the nation in contract terminations, according to real estate brokerage Redfin, citing November data when about one in five deals crumbled.

“It is a pain point for all agents right now,” said Lindsay Levin, a real estate agent with Berkshire Hathaway HomeServices Georgia Properties. Levin said that, in 2025, she had multiple homes go under contract three times before finally selling.

Deals could fall apart because of repair issues, or the buyer can’t secure financing or sell their current home, Redfin said in an October report. Sellers could also be unrealistic with their expectations, thinking they can sell their homes “as-is for top dollar,” the brokerage says.

Some homebuyers, after receiving inspection reports, are walking away from deals without even negotiating with sellers, Levin said. Others may have personal reasons for backing out.

“I had a deal terminate because the buyer thought that the purchase of this home would save their marriage,” Levin said. “They’ll terminate for reasons that often we just can’t even begin to predict.”

The trend comes as housing inventory surged in 2025, giving buyers more choices and negotiating power. In December, there were more than 18,000 active listings in metro Atlanta, up almost 10% from the same month a year ago.

Active listings peaked last summer at more than 22,000, with metro Atlanta ending July with about 4.8 months’ worth of housing inventory.

Consider that when interest rates dipped to historic lows during the COVID-19 pandemic, there was less than a month of homes listed for sale, leading to bidding wars and soaring prices.

“More choices allow buyers to take more time and delay purchase decisions, a factor which was not afforded to them during the pandemic years,” John Ryan, Georgia MLS chief marketing officer, said in a prepared statement.

“The shift toward a more balanced market has reduced buyers’ sense of urgency, as they no longer feel pressured to make rapid offers to avoid missing out, unlike in prior years of tight inventory,” he said.

In December, metro Atlanta home sales reached about $2.2 billion, basically flat from the same month a year ago. The median sales prices dipped to $390,095, down 2.5% from a year ago.

Winter months are typically slower for home-buying activity. Uncertainty stemming from the federal government shutdown, as well as a cooling labor market, could also have put off homebuyers.

Nationwide, the housing market has been in a slump because of higher borrowing costs and elevated prices.

“Housing affordability is a big speed bump,” said Leslie Appleton-Young, chief economist for the First Multiple Listing Service. “It’s causing friction in the system right now because people just can’t piece it together.”

But several experts said they feel optimistic about the new year, as mortgage rates are down almost a full percentage point from the beginning of 2025, which should improve affordability some.

The average rate for a 30-year fixed mortgage is 6.16%, mortgage giant Freddie Mac said Jan 8.

“If they drop into the fives, I think we’re going to see the floodgates open again,” said Jones with Re/Max Around Atlanta.

Appleton-Young is forecasting metro Atlanta home sales to increase 3% to 5% in 2026. Home prices could be flat or increase 2% to 4%, she predicts.

“It’s going to be so busy,” said Levin, the real estate agent with Berkshire Hathaway HomeServices Georgia Properties. “Our pipelines for spring activity are so full of sellers and buyers. Some of the buyers that have been on the fence … were just waiting for the spring market.”