Realtors are encountering a growing number of hesitant buyers as the current real estate market presents significant challenges. According to a report from Redfin, nearly 56,000 home-purchase agreements were canceled in June, representing 15% of all homes under contract that month, marking the highest rate ever recorded for June.
Julie Zubiate, a Redfin Premier real estate agent in the San Francisco Bay Area, attributes this spike in cancellations to increasingly selective buyers who face a costly 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,” Zubiate explained.
In Miami, fellow Redfin agent Rafael Corrales has witnessed “nightmare scenarios” involving last-minute cancellations over trivial matters. Last month, about 2,500 home purchases were called off in Miami, reflecting a cancellation rate of around 17.6% for homes that went under contract in June. Corrales emphasizes that the primary concern remains affordability.
The median home sale price reached a record high of $442,525 in June, while the average rate for a 30-year mortgage stood at 6.92%. In addition to the steep cost of homes, potential buyers are facing increased expenses related to insurance, property taxes, HOA fees, and other ownership costs, all of which have been intensified by inflation.
This widespread lack of affordability has led to a significant decline in home sales nationwide, according to Redfin. Month-over-month, home sales dropped by 0.5% in June, the largest decrease since October 2023. On a yearly basis, sales fell 1.1% and were 21.5% below pre-pandemic levels.