Realtors are encountering a greater number of hesitant buyers as consumers become increasingly selective in a challenging real estate market.
A recent report from Redfin revealed that almost 56,000 home-purchase agreements were canceled in June, amounting to 15% of all homes that went under contract that month. This figure represents the highest percentage of cancellations recorded for any June by the real estate firm.
Julie Zubiate, a Redfin Premier real estate agent in the San Francisco Bay Area, attributed this trend to buyers who are more discerning due to rising expenses in the market. She noted, “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.”
In Miami, another Redfin agent, Rafael Corrales, described witnessing “nightmare scenarios” where buyers cancel deals over trivial details. Approximately 2,500 home purchases were canceled in Miami last month, equating to around 17.6% of homes that were under contract in June. Corrales emphasized that the main concern among buyers is affordability.
In June, the median home sale price hit a record $442,525, with average mortgage rates for 30-year loans standing at 6.92%. Prospective buyers are further hindered by additional costs related to homeownership, such as insurance, property taxes, and homeowners association fees, all of which have been worsened by inflation.
The nationwide lack of affordability has led to the most significant drop in home sales in eight months, according to Redfin. Month-over-month, home sales decreased by 0.5% in June, marking the largest decline since October 2023. Year-over-year, sales fell 1.1% and remain 21.5% below pre-pandemic figures.