Realtors are facing a surge in buyers backing out of home purchases as the real estate market grows increasingly challenging. A Redfin report revealed that nearly 56,000 home-purchase agreements were canceled in June, representing 15% of all homes under contract that month. This marks the highest percentage reported for June by the real estate platform.
Julie Zubiate, a Redfin Premier real estate agent in the San Francisco Bay Area, attributes this rise in cancellations to buyers being more selective due to the higher costs associated with purchasing a home. She noted that buyers are withdrawing over minor issues since the overall expenses of homeownership have become increasingly difficult to justify.
Rafael Corrales, a Redfin agent in Miami, highlighted distressing incidents, including last-minute cancellations over trivial details. Last month, approximately 2,500 home purchases were canceled in Miami, which constitutes about 17.6% of homes under contract. Corrales emphasized that the main concern is affordability.
In June, the median home sale price hit a record high of $442,525, while the average rate for a 30-year mortgage reached 6.92%. Buyers are also challenged by additional costs such as insurance, property taxes, and homeowners association fees, all of which have been inflated by rising prices.
The nationwide affordability crisis has resulted in a notable decline in home sales, with Redfin reporting the most significant drop in eight months. Monthly home sales fell by 0.5% in June, the largest decrease since October 2023. Year-over-year, home sales decreased by 1.1% and remain 21.5% below levels seen before the pandemic.