Realtors are encountering an increasing number of indecisive buyers as individuals become more selective in a challenging real estate environment.
According to a report by Redfin, nearly 56,000 home purchase agreements fell through in June, representing 15% of all homes that went under contract that month. This marks 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Julie Zubiate, a Redfin Premier real estate agent in the San Francisco Bay Area, attributed the rise in withdrawn offers to more discerning buyers facing high market prices. “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,” Zubiate explained.
Rafael Corrales, another Redfin agent in Miami, reported witnessing “nightmare scenarios” where last-minute cancellations occurred over trivial details. In Miami alone, about 2,500 home purchases were canceled last month, accounting for approximately 17.6% of homes that went under contract in June. Corrales noted that the primary concern remains affordability.
The median home sale price reached an all-time high of $442,525 in June, while the average interest rate for a 30-year mortgage stood at 6.92%. Alongside the elevated home prices and high mortgage rates, prospective buyers are also burdened by additional costs such as insurance, property taxes, and HOA fees, all of which have been exacerbated by inflation.
Nationwide, the unaffordability in the market has led to a significant decline in home sales, the largest drop in eight months, according to Redfin. Monthly home sales saw a decrease of 0.5% in June, marking the steepest decline since October 2023. Year-over-year, home sales decreased by 1.1% and were 21.5% lower than pre-pandemic levels.