Realtors are facing an unprecedented number of buyers withdrawing from home purchase agreements as elevated prices and a challenging market conditions lead to increased scrutiny among potential homeowners.
According to a recent report by Redfin, nearly 56,000 home-purchase agreements were canceled in June, representing 15% of all homes that were under contract during that month. This marks the highest percentage of canceled agreements for any June recorded by the real estate platform.
Julie Zubiate, a Redfin Premier agent in the San Francisco Bay Area, attributed this rise in buyer hesitance to the expensive market, where buyers are becoming more selective. She noted that many are withdrawing over minor issues, as the costs of homeownership are too significant to overlook.
Rafael Corrales, a Redfin agent based in Miami, reported experiencing “nightmare scenarios,” including last-minute cancellations over trivial details. In Miami alone, approximately 2,500 home purchases were canceled in June, accounting for about 17.6% of homes that went under contract. Corrales emphasized that affordability remains the primary concern for buyers.
The median home sale price reached a historic high of $442,525 in June, with the average 30-year mortgage rate at 6.92%. This, combined with rising property insurance, taxes, HOA fees, and other ownership costs, has made purchasing a home increasingly burdensome for buyers.
The affordability crisis has led to a significant drop in home sales across the nation, with Redfin reporting a monthly decrease of 0.5% in June, the largest decline in eight months. Year-over-year, homes sales fell by 1.1%, and were 21.5% lower than pre-pandemic figures.