Realtors are experiencing a surge in hesitant buyers as the real estate market becomes increasingly challenging. According to a report released by Redfin, nearly 56,000 home-purchase agreements, representing 15% of all homes that went under contract in June, fell through. This marks the highest percentage recorded for June in the platform’s history.
Julie Zubiate, a Redfin Premier real estate agent based in the San Francisco Bay Area, attributed this rise in buyer withdrawals to a more discerning clientele grappling with elevated market prices. 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, another Redfin agent from Miami, described having witnessed “nightmare scenarios” where buyers canceled contracts at the last minute over trivial details. In Miami alone, about 2,500 home purchases were canceled last month, amounting to approximately 17.6% of homes that had been contracted in June. Corrales emphasized that the primary concern remains affordability.
In June, the median home sale price hit a record high of $442,525, with the average rate for a 30-year mortgage at 6.92%. Coupled with the elevated home prices and high mortgage rates, potential buyers are also feeling the crunch from rising insurance costs, property taxes, HOA fees, and other homeownership expenses, further intensified by inflation.
This nationwide affordability crisis has led to the most significant decline in home sales observed in eight months, according to Redfin. Month-over-month, home sales fell by 0.5% in June, marking the largest decrease since October 2023. Year-over-year, home sales decreased by 1.1% and are down 21.5% compared to pre-pandemic levels.