Realtors are encountering a growing number of indecisive buyers in the current challenging real estate market.
According to a report from Redfin, nearly 56,000 home-purchase agreements were canceled in June, accounting for 15% of all homes that went under contract that month. This marks the highest percentage recorded for June since the company began tracking the data.
Julie Zubiate, a Redfin Premier real estate agent in the San Francisco Bay Area, attributed this trend to buyers becoming more selective in light of rising housing costs. She stated, “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.”
Rafael Corrales, a Redfin agent in Miami, reported seeing significant cancellations, including last-minute withdrawals over small details. In Miami alone, approximately 2,500 home purchases were canceled last month, representing 17.6% of homes that went under contract. He emphasized that the primary concern is affordability.
In June, the median home sale price reached an all-time high of $442,525, while the average interest rate for a 30-year mortgage stood at 6.92%. In addition to the steep home prices and elevated mortgage rates, potential buyers are facing additional financial burdens from insurance, property taxes, homeowners association fees, and other costs, which have been intensified by inflation.
The nationwide affordability crisis has led to a significant decline in home sales, according to Redfin. Home sales in June decreased by 0.5%, marking the largest monthly drop since October 2023. Compared to the previous year, sales dipped by 1.1% and remained 21.5% below the levels seen before the pandemic.