Something is going sideways between offer accepted and keys in hand. We're seeing it across Canada, and we're seeing it here in the Okanagan too. More deals are collapsing before closing, and the reasons go well beyond the usual nervousness that comes with buying or selling a home.

A new survey of more than 1,000 real estate professionals across Canada, conducted by Ownright between late March and late April 2026, found that failed transactions are clearly on the rise. Financing failure was the top cause, cited by 34 per cent of agents. And 38 per cent said more deals were falling apart over financing issues now compared to two years ago.

That's a notable number. It means the problem isn't just a few unlucky files. It's a structural pattern.

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Why Financing Is Failing More Often

The mechanics of a financing collapse have changed. It used to be that a deal fell through because a buyer couldn't get approved at all. That still happens. But today, a growing share of failures come from buyers who were approved when they made the offer and then couldn't close when the time came.

Joel Fox, co-founder and COO of Ownright, points to a few specific failure modes. Buyers are adding multiple conditions to their offers, which creates what he calls an "easier off-ramp" to walk away. Others run into trouble because their purchase depended on selling another property first, and that other deal fell through or closed for less than expected. When the equity math stops working, the whole chain breaks.

On the seller side, the problem is different but just as real. Some sellers can't complete their transactions because the sale price won't cover what they owe. Property values have fallen and high-interest mortgages, sometimes more than one, are registered against the title. There isn't enough proceeds to pay everyone out. Fox confirmed this has become "much more prevalent" as values have declined.

This is what a slow correction looks like up close. It isn't just lower prices on a chart. It's people who bought at the top, locked in elevated debt, and are now stuck in a math problem with no clean way out.

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The Psychology Shift Is Real

Interest rates and prices are the traditional levers buyers and sellers watch. When rates go down, people buy. When prices soften, people buy. That logic used to be reliable.

It isn't holding the same way anymore. 67 per cent of real estate professionals surveyed say their clients are more risk-averse today than they were before 2022. That's two-thirds of agents, nationwide, observing a durable change in buyer behaviour. We'd say the same thing from where we sit in Kelowna.

Fox put it plainly: the calculation of participating in the housing market has gotten more complicated. People are thinking about the broader economy, their job security, and the general sense of instability coming from south of the border. Nearly one-quarter of agents in the survey said that U.S. political and economic instability "frequently" undercut deals. Another 69 per cent said it occasionally played a role.

That's an almost universal acknowledgment that geopolitics is now a factor in residential real estate transactions in Canada.

When the survey asked what was driving buyer hesitation, 40 per cent of agents pointed to broader economic concerns including recession fears. Employment uncertainty came in at 17 per cent. Interest rates, which would have topped this list a few years ago, came in at 15 per cent.

The hierarchy of concerns has genuinely shifted.

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What the Market Numbers Confirm

The survey results don't exist in a vacuum. The national MLS benchmark price is now down roughly 20 per cent from the early-2022 peak, marking the 14th consecutive monthly decline as of March 2026. The average sale price in March 2026 came in at $673,084, down 0.8 per cent year-over-year.

Sales volumes have also contracted significantly since the pandemic highs. CREA's April 2026 release showed only a 0.7 per cent month-over-month gain, with CREA's senior economist noting the expected rebound "will continue to be muted." The association has revised its 2026 forecast downward twice this year, now projecting just a 1 per cent increase in transactions nationally.

Against that backdrop, a rise in failed transactions makes sense. Buyers are stretched, sellers are sometimes underwater, and the macro environment keeps giving both sides reasons to hesitate or back out.

Fox said he doesn't expect a meaningful rebound anytime soon. The survey data reflects that uncertainty too. 43 per cent of agents are confident the market will recover in the next 12 months, but 25 per cent are outright pessimistic and 28 per cent are neutral. Roughly half the industry isn't counting on a recovery.

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How to Protect Your Transaction Right Now

Failed transactions carry real costs. Legal fees still get incurred. Deposits can be disputed. Time gets lost. And the emotional toll of a deal collapsing close to closing is significant, particularly for sellers who already had plans in motion.

If you're buying, conditions in your offer are reasonable protection in this market, but only if you've actually done the work before removing them. A pre-approval is not enough. You need to verify that your financing will hold through to closing, especially if your purchase depends on selling another property first. That's the piece people most often skip, and it's the one that causes chains to break.

If you're selling, understanding your net proceeds before you accept any offer matters more now than it used to. An offer at asking price means nothing if the deal collapses because the buyer's chain unravelled, or because you can't clear the debt on title. Reviewing your numbers with your agent before listing, not after you're already under contract, is what separates a clean sale from a stressful one.

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We work with buyers and sellers across the Okanagan every day in these exact conditions. If you're trying to figure out whether now is the right time to move, or whether your deal is structured in a way that can actually close, our team is here to help you think it through.