Realtors are experiencing an increasing number of indecisive buyers as individuals become choosier in a challenging real estate market.
According to a report from Redfin, nearly 56,000 home-purchase agreements were abandoned in June, equating to 15% of all homes that went under contract that month. This represents the highest percentage recorded for any June by the real estate platform.
Julie Zubiate, a Redfin Premier real estate agent in the San Francisco Bay Area, attributed the surge in cancellations to buyers’ heightened selectivity in a market that is more costly. “They are opting out because of minor issues since the financial commitments associated with purchasing a home today are just too steep to overlook not getting everything on their must-have list,” she stated.
Rafael Corrales, another Redfin agent in Miami, shared that he has witnessed troubling scenarios, with last-minute cancellations occurring over trivial issues. Approximately 2,500 home purchases were terminated in Miami last month, which accounts for about 17.6% of homes under contract in June. Corrales noted that the primary concern remains affordability.
In June, the median home sale price reached an all-time high of $442,525, with the average rate on a 30-year mortgage hitting 6.92%. Coupled with high home prices and elevated mortgage rates, potential buyers are further burdened by insurance, property taxes, HOA fees, and other ownership-related costs that have surged due to inflation.
This affordability crisis nationwide has led to the most significant drop in home sales in eight months, as reported by Redfin. On a month-over-month basis, home sales decreased by 0.5% in June, marking the largest decline since October 2023. Year-over-year, home sales fell by 1.1% and were down 21.5% compared to pre-pandemic figures.