Realtors are experiencing an increase in hesitant buyers as individuals become more selective in a challenging real estate market. According to a report by Redfin, nearly 56,000 home-purchase agreements were canceled in June, constituting 15% of all homes that went under contract that month. This marks the highest cancellation rate recorded in 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, often backing out of deals over minor concerns due to the high monthly costs of homeownership. Zubiate stated, “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.”
Rafael Corrales, a Redfin agent in Miami, reported similar experiences, noting that approximately 2,500 home purchases were canceled in June—around 17.6% of homes that went under contract. He highlighted affordability as the main challenge for buyers, as many are backing out at the last minute over small details.
The median home sale price surged to a record $442,525 in June, paired with an average 30-year mortgage rate of 6.92%. In addition to the elevated property prices and mortgage rates, potential homebuyers face additional financial burdens, including insurance, property taxes, and HOA fees, all of which have been worsened by inflation.
This lack of affordability has contributed to a significant drop in home sales nationwide, with Redfin noting that sales experienced a 0.5% decline in June—the largest decrease since October 2023. Year-over-year home sales also fell by 1.1%, and are currently 21.5% lower than pre-pandemic levels.