Realtors are encountering an increasing number of indecisive buyers, as individuals grow more selective in a challenging real estate market.
In June, nearly 56,000 home-purchase agreements were abandoned, representing 15% of all homes that went under contract that month, according to a report from Redfin. This marks the highest percentage for any June recorded by the real estate platform.
Julie Zubiate, a Redfin Premier real estate agent in the San Francisco Bay Area, attributed this increase in cancellations to a more discerning buyer demographic facing high market costs. She noted that many buyers are withdrawing from deals for minor issues, as the financial burden of homeownership has become substantial.
Rafael Corrales, a Redfin agent in Miami, described several troubling scenarios, including last-minute cancellations over trivial details. Approximately 2,500 home purchases were aborted in Miami last month, equating to about 17.6% of homes contracted during June. Corrales highlighted affordability as the primary challenge for buyers.
In June, the median home sale price hit a record $442,525, with the average rate for a 30-year mortgage at 6.92%. Alongside the high prices and elevated mortgage rates, potential buyers are weighed down by insurance, property taxes, homeowners association fees, and other homeownership expenses that have been worsened by inflation.
This widespread lack of affordability has led to the most significant decline in home sales 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 figures show a 1.1% decrease in home sales and a 21.5% drop compared to pre-pandemic levels.