Real estate agents are experiencing an increasing number of buyers withdrawing from home purchase agreements, as preferences shift amid challenging market conditions.
In June, nearly 56,000 home purchase agreements were abandoned, representing 15% of all contracts signed that month, as reported by Redfin. This marks the highest cancellation rate for June recorded by the real estate platform.
Julie Zubiate, a real estate agent with Redfin Premier in the San Francisco Bay Area, attributes the increased buyer hesitation to a more discerning clientele facing a costly housing market. She noted, “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.”
Rafael Corrales, another Redfin agent based in Miami, shared observations of troubling scenarios, including last-minute cancellations prompted by trivial matters. Approximately 2,500 home purchases were called off in Miami in June, accounting for roughly 17.6% of homes that went under contract. Corrales pointed out that the primary concern among buyers is affordability.
In June, the median home sale price hit an all-time high of $442,525, alongside an average 30-year mortgage rate of 6.92%. Additionally, potential buyers are facing challenges from rising insurance costs, property taxes, homeowners association fees, and other expenses related to homeownership—all intensified by inflation.
The national affordability crisis has contributed to the most significant downturn in home sales in the past eight months. According to Redfin, home sales decreased by 0.5% in June compared to May, marking the largest drop since October 2023. Year-over-year, sales dipped by 1.1% and fell 21.5% beneath pre-pandemic levels.