Realtors are facing an unprecedented number of unpredictable buyers as individuals become increasingly selective in a challenging real estate environment.
Recent data reveals that nearly 56,000 home-purchase agreements were abandoned in June, accounting for 15% of all homes that went under contract that month. This marks the highest percentage recorded for any June, as reported by Redfin.
Julie Zubiate, a real estate agent at Redfin Premier in the San Francisco Bay Area, attributed the rise in canceled agreements to buyers who are more discerning in a costlier market. She noted that potential buyers are withdrawing due to minor concerns because the monthly expenses associated with home purchasing are significantly high.
Rafael Corrales, a Redfin agent based in Miami, shared experiences of “nightmare scenarios,” including last-minute withdrawals over trivial matters. Approximately 2,500 home purchases were canceled in Miami last month, which represents about 17.6% of contracted homes in June. Corrales highlighted that unaffordability remains the primary challenge.
In June, the median home sale price hit a record high of $442,525, while the average rate for a 30-year mortgage was reported to be 6.92%. Besides the elevated prices, prospective buyers are burdened by insurance costs, property taxes, HOA fees, and other financial responsibilities tied to homeownership, all exacerbated by inflation.
This lack of affordability is prompting a significant downturn in home sales across the country, marking the largest decline in eight months, according to Redfin. Month-over-month, home sales saw a decrease of 0.5% in June, the most considerable drop since October 2023. Year-over-year, sales fell by 1.1% and were 21.5% lower than pre-pandemic figures.