Realtors are encountering an unprecedented number of indecisive buyers as individuals become increasingly selective amidst a challenging real estate market.
In June, nearly 56,000 home purchase agreements were terminated, accounting for 15% of all homes that went under contract that month, according to a report from Redfin. This marks the highest percentage ever recorded for June by the real estate site.
Julie Zubiate, a Redfin Premier real estate agent in the San Francisco Bay Area, attributed the uptick in buyer withdrawals to a more discerning clientele who are facing a pricier market.
“They’re stepping back due to minor issues because the monthly costs associated with buying a home today are just too steep to justify not securing everything on their wish list,” Zubiate explained.
Similarly, Rafael Corrales, a Redfin agent in Miami, reported witnessing troubling scenarios, including last-minute cancellations over trivial matters. Last month, approximately 2,500 home purchases were called off in Miami, representing about 17.6% of homes that had gone under contract in June. However, Corrales stressed that the primary concern is affordability.
The median home sale price hit a record high of $442,525 in June, while the average rate for a 30-year mortgage stood at 6.92%. In addition to the elevated prices of homes currently on the market and ongoing high mortgage rates, potential home buyers are also burdened by insurance costs, property taxes, homeowners association fees, and other expenses linked to homeownership, all of which have been intensified by inflation.
This widespread lack of affordability has led to the most significant decline in home sales seen in eight months. According to Redfin, home sales dropped by 0.5% in June compared to the previous month, the largest decrease since October 2023. On a year-over-year basis, home sales fell by 1.1% and were 21.5% lower than levels observed prior to the pandemic.