Realtors are facing an increasing number of buyers backing out of home purchases, as potential homeowners become more selective in a challenging real estate landscape.
According to a recent report from Redfin, nearly 56,000 home-purchase agreements fell through in June, accounting for 15% of all homes that were under contract that month. This marks the highest rate for June recorded by the real estate platform.
Julie Zubiate, a Redfin Premier real estate agent in the San Francisco Bay Area, attributes this trend to buyers who are hesitant due to the increased costs in today’s market. “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,” Zubiate explained.
Rafael Corrales, a Redfin agent in Miami, described some troubling scenarios, including last-minute cancellations over minor details. In Miami alone, approximately 2,500 home purchases were canceled in June, which represents about 17.6% of homes that went under contract. He emphasized that the primary concern is affordability.
The median home sale price soared to a record $442,525 in June, with the average rate for a 30-year mortgage at 6.92%. Buyers are also contending with increased costs from insurance, property taxes, HOA fees, and other expenditures tied to homeownership, all of which have been affected by inflation.
The nationwide affordability crisis has resulted in the largest drop in home sales in eight months, according to Redfin. Month-over-month, home sales decreased by 0.5% in June, marking the steepest decline since October 2023. In comparison to the previous year, home sales are down 1.1% and are 21.5% lower than pre-pandemic figures.