Realtors are encountering an increasing number of indecisive buyers as the real estate market remains challenging.
A recent report from Redfin revealed that nearly 56,000 home-purchase agreements were canceled in June, representing 15% of all homes that were under contract that month. This marks the highest cancellation rate for June recorded by the real estate platform.
Julie Zubiate, a Redfin Premier agent in the San Francisco Bay Area, attributed the rise in buyer hesitancy to a more discerning clientele facing higher expenses in the 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, another Redfin agent based in Miami, described witnessing “nightmare scenarios,” including last-minute cancellations over trivial details. In Miami alone, approximately 2,500 home purchases were called off in June, equivalent to about 17.6% of homes that were under contract. Corrales pointed out that the core issue remains affordability.
The median home sale price reached an all-time high of $442,525 in June, while the average rate for a 30-year mortgage was recorded at 6.92%. Coupled with high home prices and persistent mortgage rates, prospective buyers are also facing additional burdens from insurance, property taxes, HOA fees, and other costs associated with homeownership, all of which have been exacerbated by inflation.
The nationwide affordability crisis has led to a decrease in home sales, marking the most significant decline in eight months according to Redfin. On a monthly basis, home sales fell by 0.5% in June, representing the largest drop since October 2023. On a year-over-year basis, home sales decreased by 1.1% and were 21.5% lower than pre-pandemic levels.