I got a little suspicous when I first posted this Altos chart showing the Market Action Index (less than 30 suggests a buyer’s market, duh) and weekly absorption (homes opening escrow) for Scripps Ranch. Specifically, this data shows Scripps Ranch detached homes going into escrow at a clip of approximately 8 to 10 per week, yet I know that we aren’t closing 40 homes a month.
My own experience tells me why we are seeing a discrepancy; more homes are failing to close once under contract or, as we more commonly say, falling out of escrow.
This morning I took a quick peek into the statistics, courtesy of the Sandicor Multiple Listing Service. I looked at both homes which successfully recorded in July and homes currently in escrow to see how many of these had experienced previous failed attempts.
On the one hand, I expected the data to be worse (more “fallout”). On the other hand, if you have found yourself in that smaller slice of the pie, it’s pretty bad. And, from purely the agent’s perspective, you can imagine how much we love doing everything twice. Again based on my experience, this is partially due to buyer cold feet in an uncertain market but mostly due to the difficulty in obtaining financing in a market where the rules of underwriting are changing as often as a new mother of twins. In recent times, up until about a year ago, failed sales were quite the unexpectedly anomaly. Today, it is important to remember that your home is not truly sold until the Fat Lady gets her County tax stamp.
ABOUT THE AUTHOR Kris Berg is Co-Owner and Designated Broker of San Diego Castles Realty. If not-so static web sites are your thing, go here at once where you will find loads of real estate information including homes for sale, market trends, floor plans and more. Kris's hobbies include fencing and spot welding. She likes kittens. 
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Oh yes, falling out of escrow is no fun. We fell out in 2005 while selling in Carmel Valley. It wasn’t ever clear that anything was wrong other than the buyer changed their mind.
Interesting numbers. Sorry to see so many are not making it through the entire escrow period.
Jim – Wow! In 2005, those heady days of multiple offers over asking price, one had to really get the short straw to fall out. Bummer.
We turned around and sold that house a month or so later, but it still was not any fun.
Kris,
A similar thing is happening over in our market. Pending homes sales is sky-rocketing but is still higher than SOLD’s.
“mostly due to the difficulty in obtaining financing in a market where the rules of underwriting are changing as often as a new mother of twins.”
I can relate to that as well.
Good post.