Realtors are facing an increasing number of buyers who are backing out of transactions, as individuals grow more selective amid a challenging real estate landscape. According to a report by Redfin, nearly 56,000 home-purchase agreements fell through in June, representing 15% of all homes that went under contract that month. This marks the highest percentage recorded for June by the real estate platform.
Julie Zubiate, a Redfin Premier real estate agent in the San Francisco Bay Area, attributed this rise in cancellations to buyers being more discerning in a continuing expensive market. She noted that many buyers are withdrawing over minor issues, as the monthly expenses tied to purchasing a home are often too significant to overlook.
In Miami, Redfin agent Rafael Corrales reported experiences of “nightmare scenarios” involving last-minute cancellations over small details, with around 2,500 home purchases canceled in June, amounting to approximately 17.6% of homes under contract. Corrales emphasized that affordability remains the primary concern for potential buyers.
The median home sale price reached a historic high of $442,525 in June, while the average rate on a 30-year mortgage stood at 6.92%. In addition to the steep home prices and elevated mortgage rates, buyers are also burdened by insurance, property taxes, HOA fees, and various other costs linked to homeownership, all of which have been intensified by inflation.
This widespread lack of affordability has led to the most significant decline in home sales nationwide in the past eight months, as reported by Redfin. Monthly home 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 down by 21.5% compared to pre-pandemic levels.