Realtors are facing an unprecedented number of indecisive buyers as individuals become more selective in an increasingly challenging real estate market.
A recent report by Redfin revealed that nearly 56,000 home-purchase agreements collapsed in June, accounting for 15% of all homes that went under contract that month. This marks the highest percentage for any June recorded by the platform.
Julie Zubiate, a Redfin Premier agent in the San Francisco Bay Area, attributed the surge in buyers backing out to a more discerning clientele struggling with rising costs in the housing market. She noted that buyers are withdrawing for seemingly minor issues because the high monthly costs associated with homeownership are making them more hesitant to proceed without meeting all their criteria.
In Miami, Redfin agent Rafael Corrales reported that he has witnessed “nightmare scenarios” unfold, including last-minute cancellations over trivial details. Approximately 2,500 home purchases were canceled in Miami in June, representing about 17.6% of homes that went under contract. Corrales emphasized that the primary concern remains affordability.
The median price for home sales reached a record high of $442,525 in June, with the average interest rate on a 30-year mortgage sitting at 6.92%. Prospective buyers are also burdened by rising insurance costs, property taxes, HOA fees, and other expenses tied to homeownership, all of which have been worsened by inflation.
Overall, the persisting lack of affordability across the country has led to a significant decline in home sales, marking the most considerable drop in eight months. Redfin reports a 0.5% decrease in home sales from May to June, the largest drop since October 2023. Year-over-year, home sales fell by 1.1% and remain 21.5% below levels seen before the pandemic.