Realtors are facing a surge in buyers backing out of home purchases, driven by heightened selectiveness in a challenging real estate environment. A report from Redfin revealed that nearly 56,000 home-purchase agreements were terminated in June, accounting for 15% of all homes that had been under contract, marking the highest percentage recorded for June.
Julie Zubiate, a Redfin Premier real estate agent in the San Francisco Bay Area, attributed this phenomenon to buyers who are becoming increasingly choosy. She noted that many are withdrawing due to minor issues, as the ongoing expenses of homeownership are significant enough that buyers are reluctant to settle for anything less than their ideal requirements.
In Miami, Redfin agent Rafael Corrales reported experiencing “nightmare scenarios,” with numerous last-minute cancellations over trivial matters. In June alone, approximately 2,500 home purchases were canceled in Miami, representing about 17.6% of homes that went under contract. Corrales highlighted that the primary concern is the affordability of homes.
The median home sale price hit a record high of $442,525 in June, while the average rate for a 30-year mortgage stood at 6.92%. The combination of escalating home prices, persistent mortgage rates, and additional costs associated with homeownership, including insurance, property taxes, and HOA fees—exacerbated by inflation—have further complicated the landscape for potential buyers.
Due to the overwhelming lack of affordability nationwide, home sales have experienced their biggest decline in eight months, according to Redfin. On a monthly basis, sales dropped by 0.5% in June, marking the largest decrease since October 2023. Year-over-year, home sales fell by 1.1% and were 21.5% lower than pre-pandemic levels.