Realtors are facing an increasing number of buyers backing out of home purchases as preferences shift in the challenging real estate market. A report from Redfin revealed that nearly 56,000 agreements for home purchases were canceled in June, equating to 15% of all homes that went under contract that month. This marks the highest cancellation rate recorded for June.
Julie Zubiate, a Redfin Premier agent in the San Francisco Bay Area, attributed this trend to buyers being more selective in a challenging financial environment. She noted that buyers are withdrawing from deals over minor issues because the cost of homeownership has become too burdensome.
In Miami, agent Rafael Corrales described extreme cases of last-minute cancellations driven by small details, with roughly 2,500 home purchases called off in June—about 17.6% of contracted homes in the area. He pointed to affordability as the primary concern for many buyers.
The median home price hit a record $442,525 in June, with a 30-year mortgage rate averaging 6.92%. Alongside elevated home prices, buyers are also facing rising insurance costs, property taxes, and HOA fees, all intensified by inflation.
This widespread lack of affordability has resulted in the steepest decline in home sales seen in the last eight months, according to Redfin. Monthly home sales dropped by 0.5% in June, marking the largest decrease since October 2023, and year-over-year sales fell by 1.1%, representing a 21.5% decline compared to pre-pandemic levels.