Realtors are increasingly facing challenges as a growing number of buyers back out from home purchases, driven by heightened selectivity in a challenging real estate market.
In June, nearly 56,000 home-purchase agreements were canceled, accounting for 15% of all homes that went under contract during that month, as reported by Redfin. This figure represents the highest percentage recorded for any June by the real estate platform.
Julie Zubiate, a Redfin Premier real estate agent in the San Francisco Bay Area, attributed this trend to buyers who are now more discerning due to rising costs in the housing market. She noted that many are withdrawing due to what she describes as minor issues, as the high monthly costs of homeownership make it difficult to forgo any of their desired features.
Rafael Corrales, another Redfin agent based in Miami, reported witnessing troubling situations, including last-minute cancellations over minor details. In June alone, approximately 2,500 home agreements were terminated in Miami, which represents about 17.6% of homes that were under contract during that month. Corrales emphasized that the primary concern is affordability.
The median home sale price hit a record $442,525 in June, while the average rate for a 30-year mortgage reached 6.92%. Buyers are grappling with high home prices, soaring mortgage rates, and additional costs like insurance, property taxes, and homeowners association fees, all of which have been intensified by inflation.
This unaffordability issue on a national scale has contributed to the largest drop in home sales in eight months. Redfin found that on a monthly basis, home sales fell by 0.5% in June, marking the most significant decline since October 2023. Year-over-year, home sales decreased by 1.1% and were found to be 21.5% below pre-pandemic levels.