Realtors are witnessing a rise in indecisive buyers as individuals become more selective in a challenging real estate market.
A recent report from Redfin reveals that nearly 56,000 home-purchase agreements were canceled in June, which equates to 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, attributes the increase in last-minute cancellations to buyers’ heightened expectations in a more expensive market. “They’re backing out due to minor issues because the monthly costs associated with buying a home today are just too high to justify not getting everything on their must-have list,” Zubiate stated.
In Miami, another Redfin agent, Rafael Corrales, noted experiencing “nightmare scenarios” where buyers have canceled purchases over trivial concerns. In June, approximately 2,500 home purchases were abandoned in Miami, representing about 17.6% of homes that were under contract. Corrales highlighted that the primary challenge remains affordability.
The median home sale price hit a record $442,525 in June, alongside an average 30-year mortgage rate of 6.92%. Coupled with elevated home prices, prospective buyers are also faced with increased insurance, property taxes, homeowner association fees, and other expenses tied to homeownership, all intensified by inflation.
This widespread lack of affordability has led to a notable decline in home sales nationwide, marking the most significant drop in eight months, according to Redfin. On a monthly basis, home sales decreased by 0.5% in June, the most substantial reduction since October 2023. Year-over-year, home sales fell by 1.1% and were down 21.5% compared to levels seen before the pandemic.