Real estate agents are facing an unprecedented number of indecisive buyers as individuals become more selective during a challenging real estate climate.
According to a recent Redfin report, nearly 56,000 home-purchase agreements were abandoned in June, constituting 15% of all homes that went under contract that month. This marks the highest percentage recorded for any June.
Julie Zubiate, a Redfin Premier real estate agent in the San Francisco Bay Area, attributed the increase in cancellations to buyers who are now more discerning due to rising costs in the market. “They’re backing out due to minor issues because the monthly costs associated with buying a home today are just too high to rationalize not getting everything on their must-have list,” she explained.
In Miami, agent Rafael Corrales noted he has witnessed troubling situations unfold, including last-minute cancellations over trivial matters. Approximately 2,500 home purchases were canceled in Miami last month, representing around 17.6% of homes that went under contract. Corrales emphasized that the core issue remains affordability.
In June, the median home sale price hit a record high of $442,525, with the average rate for a 30-year mortgage at 6.92%. Alongside elevated home prices and persistent mortgage rates, potential buyers are also struggling with additional expenses such as insurance, property taxes, and HOA fees, all of which have been worsened by inflation.
This affordability crisis has led to a notable decline in home sales across the country, with Redfin reporting the largest decrease in eight months. Monthly home sales dipped by 0.5% in June, marking the largest decline since October 2023. Year-over-year, home sales fell by 1.1%, sitting 21.5% below pre-pandemic levels.