Real estate agents are facing an unprecedented number of buyers who are backing out of deals, as preferences shift in a challenging housing market.
A recent report from Redfin revealed that nearly 56,000 home-purchase agreements were canceled in June, representing 15% of all contracts signed that month. This marks the highest cancellation rate recorded for June by the platform.
Julie Zubiate, a Redfin Premier agent in the San Francisco Bay Area, attributed the increase in buyer remorse to a more selective audience grappling with the high costs associated with purchasing a home. “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.
Rafael Corrales, a Redfin agent in Miami, described witnessing “nightmare scenarios” where last-minute cancellations arise over trivial details. Approximately 2,500 home purchases in Miami were canceled in June, equating to about 17.6% of contracts. He emphasized that the core issue remains affordability.
The median home sale price hit a record $442,525 in June, with the average 30-year mortgage rate at 6.92%. In addition to high home prices and enduring mortgage rates, potential buyers are also contending with insurance costs, property taxes, HOA fees, and other expenses linked to homeownership that have been worsened by inflation.
This affordability crisis has contributed to the most significant decline in home sales in eight months, according to Redfin. Home sales decreased by 0.5% over the month of June, marking the steepest drop since October 2023. Year-over-year, home sales fell by 1.1% and were 21.5% lower than pre-pandemic levels.