There seem to be a large number of contracts falling apart recently. This is purely anecdotal, but it seems like more than normal are failing to move from contract stage to settlement successfully.

There could be a number of reasons for this. The most obvious one is that they may be contingent on the sale of the buyers home and in this market many of them simply aren't selling.

Interest rates have increased very moderately in the past few months and there are some buyers who, even if they still qualify, are getting worried about handling the monthly payments and back out. And lending institutions are becoming less interested in some of the more exotic financial instruments!

Buyers are also backing away from contracts occasionally because they fear prices will go lower still and they won't get the best deal. While prices may still go lower, I believe you'll have trouble justifying the money you'll lose on rising interest rates versus what you gain by falling prices. There's a caveat there. If you're not planning on staying more than three years I'd still be careful about buying right now.

And then there are the deals that fall apart in any market over home inspection issues. But I wonder if some sellers are more reluctant to agree to fix any home inspection items because the contract price is already so low?

That's what I'm seeing. What are you seeing out there if you're an agent? If you're a buyer or seller, share your experiences!