The majority of contracts settle on time, but more than a quarter of practitioners are citing delays due to common culprits.
In the latest REALTORS® Confidence Index report, 29 percent of real estate professionals say they faced a delay to settlement and 5 percent reported a contract that was terminated. Sixty-seven percent of practitioners reported their contracts were settled on time.
Among the contracts that had a delay to settlement, 38 percent were due to issues related to obtaining financing and 22 percent were from appraisal issues. Survey respondents blamed appraisal-centered delays on the shortage of appraisers, valuations that were not in line with market conditions, and “out-of-town” appraisers who were not familiar with local conditions.
Other issues that caused delays involved titles, sales contingencies, problems related to distressed sales, home/hazard or flood insurance issues, or a buyer losing a job.
Among contracts that were terminated, the most common reasons were related to home inspections, obtaining financing, and appraisal problems.
The median number of days to close a contract was 40 days in January, down slightly from 42 days a year ago in January 2016, NAR reports.