Realtors are facing an increasing number of buyers backing out of home purchases, as potential homeowners become more selective in a challenging real estate market.
A report from Redfin revealed that in June, nearly 56,000 home-purchase agreements fell through, representing 15% of all homes that went under contract that month. This marks the highest percentage recorded for June by the real estate site.
Julie Zubiate, a Redfin Premier real estate agent in the San Francisco Bay Area, attributes this trend to buyers who are hesitant due to the higher costs associated with home buying. She noted that buyers are withdrawing for seemingly minor issues, as the monthly expenses of owning a home have become difficult to justify without meeting all their requirements.
In Miami, Redfin agent Rafael Corrales reported witnessing significant cancellations for trivial reasons. Last month, around 2,500 home sales were called off in Miami, accounting for approximately 17.6% of homes that entered contracts in June. Corrales emphasized that affordability remains the primary concern for most buyers.
The median home sale price hit a new high of $442,525 in June, while the average 30-year mortgage rate reached 6.92%. Along with the steep home prices and elevated mortgage rates, buyers are also grappling with additional costs such as insurance, property taxes, and homeowners association fees, which have been exacerbated by inflation.
The national affordability crisis has led to the most significant drop in home sales in eight months, according to Redfin. On a monthly basis, home sales decreased by 0.5% in June, marking the largest decline since October 2023. Year-over-year, sales fell by 1.1% and were 21.5% lower than pre-pandemic levels.