Realtors are experiencing an increase in buyers backing out of home purchases, as preferences have shifted amid a challenging real estate landscape.
A recent report from Redfin revealed that nearly 56,000 home-purchase agreements fell through in June, representing 15% of all homes that were under contract that month. This marks the highest percentage recorded for June on the platform.
Julie Zubiate, a Redfin Premier real estate agent in the San Francisco Bay Area, attributes this trend to more discerning buyers facing a pricey market. “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,” she explained.
In Miami, Redfin agent Rafael Corrales noted that the situation has led to “nightmare scenarios,” including last-minute cancellations over minor details. Approximately 2,500 home purchases were canceled in Miami in June, amounting to around 17.6% of homes under contract. Corrales identified affordability as the main concern.
The median sale price for homes reached a historic $442,525 in June, while the average rate for a 30-year mortgage stood at 6.92%. Prospective buyers are further burdened by insurance, property taxes, homeowners association fees, and other costs associated with homeownership, all of which have been intensified by inflation.
This lack of affordability has contributed to a significant decline in home sales nationwide, according to Redfin. Home sales fell by 0.5% in June compared to the previous month—the largest decline since October 2023. Year-over-year, sales dipped by 1.1%, marking a 21.5% decrease from pre-pandemic levels.