Realtors are experiencing an unprecedented number of buyers backing out of home purchases, as individuals become increasingly picky in a challenging real estate landscape.
A recent report from Redfin indicates that nearly 56,000 home-purchase agreements, or 15% of all properties that went under contract in June, were canceled, marking the highest rate of cancellations ever recorded for that month.
Julie Zubiate, a real estate agent with Redfin Premier in the San Francisco Bay Area, noted that buyers are pulling out over minor issues because the overall costs associated with home ownership have become prohibitively high. “The monthly costs are just too high to rationalize not getting everything on their must-have list,” Zubiate stated.
In Miami, Redfin agent Rafael Corrales has witnessed unsettling situations, including last-minute cancellations due to minor details. Approximately 2,500 home purchases were canceled in Miami last month, equating to about 17.6% of homes that went under contract in June. Corrales pointed out that the primary concern lies with affordability.
In June, the median sale price for homes reached a record $442,525, while the average rate for a 30-year mortgage was 6.92%. The financial burden on prospective buyers is exacerbated by high home prices, elevated mortgage rates, as well as the additional costs of insurance, property taxes, and homeowner association fees, which have all increased due to inflation.
This national affordability crisis has led to the sharpest decline in home sales in eight months, as reported by Redfin. On a month-to-month basis, home sales decreased by 0.5% in June—the largest decline since October 2023. Year-over-year, home sales fell by 1.1% and stood 21.5% below pre-pandemic levels.