Realtors are facing an increasing number of buyers pulling out of home purchases as preferences shift in a challenging real estate market.
According to a Redfin report released on Tuesday, nearly 56,000 home-purchase agreements were abandoned in June, representing 15% of all homes that went under contract that month. This figure marks the highest percentage recorded for June by the real estate platform.
Julie Zubiate, a Redfin Premier real estate agent in the San Francisco Bay Area, attributed the surge in cancellations to buyers becoming more selective while navigating a costly market. She noted that buyers are withdrawing over minor issues since the financial commitments of homeownership are significant.
In Miami, Redfin agent Rafael Corrales reported witnessing “nightmare scenarios” involving last-minute pullouts over trivial details. Approximately 2,500 home purchases were canceled in Miami last month, which equates to around 17.6% of homes that were under contract in June. Corrales highlighted that the overarching concern remains affordability.
June saw the median home sale price hit a record high of $442,525, with the average 30-year mortgage rate at 6.92%. Buyers are also contending with rising insurance, property taxes, HOA fees, and various costs associated with homeownership, all intensified by inflation.
The national affordability crisis has significantly impacted home sales, which have seen their largest decline in eight months, according to Redfin. Home sales dropped by 0.5% in June, representing the most substantial decrease since October 2023. On a year-over-year basis, home sales fell by 1.1% and remained 21.5% below levels seen before the pandemic.