Realtors are encountering an unprecedented number of buyers backing out of home purchases as individuals become more selective in the challenging real estate market. A recent Redfin report indicates that nearly 56,000 home-purchase agreements fell through in June, representing 15% of all homes that entered contracts that month, marking the highest rate for any June recorded by the site.
Julie Zubiate, a Redfin Premier real estate agent in the San Francisco Bay Area, attributed this trend to buyers being more discerning, particularly in a market where prices are high. She noted that buyers are withdrawing from deals over minor concerns because the costs tied to buying a home are substantial.
Rafael Corrales, a Redfin agent in Miami, described witnessing dramatic last-minute cancellations over trivial issues, with approximately 2,500 home purchases canceled in June, accounting for about 17.6% of homes that went under contract. He highlighted that affordability remains the primary challenge.
In June, the median home sale price soared to a historic $442,525, coupled with a 30-year mortgage rate averaging 6.92%. Beyond high property prices and mortgage rates, potential buyers are also burdened by increased costs related to insurance, property taxes, HOA fees, and other ownership expenses, all exacerbated by inflation.
The national lack of affordability has resulted in the most significant decline in home sales in eight months, with Redfin reporting a 0.5% month-over-month decrease in June, the largest drop since October 2023. Year-over-year, home sales decreased by 1.1% and were 21.5% lower than before the pandemic.