Realtors are encountering an increasing number of hesitant buyers as individuals become more particular amid a challenging real estate market.
According to a report from Redfin, nearly 56,000 home-purchase agreements were canceled in June, representing 15% of all homes that went under contract during that month. This figure marks the highest percentage recorded for any June by the real estate site.
Julie Zubiate, a Redfin Premier real estate agent in the San Francisco Bay Area, attributes the increase in cancellations to a more discerning buyer demographic facing a pricier market.
“Buyers are opting out over minor issues because the monthly expenses tied to purchasing a home now feel too burdensome when they don’t meet all their requirements,” Zubiate stated.
Rafael Corrales, another Redfin agent based in Miami, highlighted extreme situations where last-minute cancellations occur over trivial details. Approximately 2,500 home transactions were called off in Miami last month, which accounts for around 17.6% of the homes that entered into contract in June. Corrales pointed out that the primary concern for buyers is affordability.
In June, the median sale price for homes reached a record high of $442,525, while the average rate for a 30-year mortgage stood at 6.92%. Along with the elevated home prices and persistent mortgage rates, prospective buyers are also facing challenges from insurance, property taxes, HOA fees, and other homeownership costs that have been worsened by inflation.
The national affordability crisis has led to a notable decline in home sales, marking the largest drop in eight months, as indicated by Redfin. Home sales decreased by 0.5% in June compared to the previous month—the largest decline since October 2023. Year-over-year, home sales fell by 1.1% and are currently 21.5% lower than pre-pandemic levels.