Realtors are encountering a surge in indecisive buyers as individuals become more selective in a challenging real estate environment.
In June, nearly 56,000 home purchase agreements collapsed, representing 15% of all homes that went under contract that month. This statistic, reported by Redfin on Tuesday, marks the highest percentage of failed contracts recorded for any June.
Julie Zubiate, a Redfin Premier real estate agent in the San Francisco Bay Area, attributed the rise in canceled deals to buyers who are more discerning and facing a costly housing 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.”
Rafael Corrales, a Redfin agent based in Miami, reported experiencing “nightmare scenarios,” including last-minute cancellations over trivial matters. In Miami, around 2,500 home purchases were called off last month, which is approximately 17.6% of homes that entered contracts in June. According to Corrales, the primary challenge remains affordability.
The median home sale price reached a record high of $442,525 in June, with the average rate on a 30-year mortgage standing at 6.92%. Prospective homeowners are further burdened by additional costs such as insurance, property taxes, HOA fees, and other homeownership expenses that have been intensified by inflation.
Overall, the affordability crisis in the housing market is contributing to the most significant decline in home sales seen in eight months, as reported by Redfin. Month-over-month, home sales decreased by 0.5% in June, marking the largest drop since October 2023. Year-over-year, home sales fell by 1.1% and were 21.5% lower than pre-pandemic figures.