Realtors are encountering more hesitant buyers than ever as consumers become choosier in the current challenging real estate environment.
A new report from Redfin reveals that nearly 56,000 home-purchase agreements were canceled in June, equating to 15% of all homes that entered contracts that month. This marks the highest cancellation rate for any June recorded by the real estate platform.
Julie Zubiate, a Redfin Premier real estate agent in the San Francisco Bay Area, attributes the increase in cancellations to buyers who are becoming more selective as they navigate 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, Redfin agent Rafael Corrales noted troubling trends, observing last-minute cancellations over seemingly insignificant details. Approximately 2,500 home purchases were called off in Miami last month, representing about 17.6% of homes that went under contract in June. Corrales pointed out that the primary concern continues to be affordability.
The median sale price for homes reached a record high of $442,525 in June, while the average rate for a 30-year mortgage stood at 6.92%. With the elevated housing prices and ongoing high mortgage rates, potential home buyers also face increased expenses related to insurance, property taxes, HOA fees, and other costs tied to homeownership, all aggravated by inflation.
This widespread lack of affordability has led to a significant decline in home sales nationwide, as reported by Redfin. Home sales fell by 0.5% in June on a monthly basis, marking the largest decrease since October 2023. Year-over-year, home sales fell by 1.1%, and they were down by 21.5% compared to pre-pandemic levels.