Realtors are facing an unprecedented number of indecisive buyers as individuals grow more selective in a challenging real estate landscape.
According to a report from Redfin released on Tuesday, nearly 56,000 home-purchase agreements were abandoned in June, representing 15% of all homes that were under contract during that month. This marks the highest cancellation rate recorded for June by the real estate service.
Julie Zubiate, a Redfin Premier real estate agent in the San Francisco Bay Area, attributes the rise in cancellations to buyers who are increasingly discerning while confronting elevated market prices.
“They are withdrawing over minor concerns because the monthly expenses tied to home buying today are too significant to overlook without having all their essential criteria met,” Zubiate stated.
In Miami, Redfin agent Rafael Corrales reported experiencing “nightmare scenarios,” where clients canceled deals at the last minute over trivial details. Last month, approximately 2,500 home purchases were called off in Miami, amounting to about 17.6% of homes that were under contract in June. Corrales highlighted that the primary challenge remains affordability.
The median home sale price soared to a record $442,525 in June, while the average rate for a 30-year mortgage stood at 6.92%. Prospective buyers are further burdened by increasing costs related to insurance, property taxes, HOA fees, and other expenses tied to homeownership, all of which have been impacted by inflation.
As affordability struggles continue to plague the market nationwide, home sales experienced their largest decline in eight months, according to Redfin. Month-over-month, home sales decreased by 0.5% in June, representing the steepest drop since October 2023. Year-over-year, home sales fell by 1.1% and were 21.5% lower than pre-pandemic figures.