Realtors are encountering an increasing number of indecisive buyers as the real estate market becomes more challenging. A new report from Redfin indicates that 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 for any June since records began.
Julie Zubiate, a real estate agent with Redfin in the San Francisco Bay Area, attributes the rise in cancellations to buyers who are becoming more selective due to the high costs associated with home purchases. She noted that buyers are backing out over minor issues, as the monthly expenses are becoming difficult to justify without securing all their desired features.
Rafael Corrales, a Redfin agent in Miami, reported seeing troubling last-minute cancellations due to small details. In Miami alone, around 2,500 home purchases were canceled in June, amounting to 17.6% of homes under contract. Corrales emphasized that the primary concern among buyers is affordability.
The median home sale price in June hit a record high of $442,525, while the average rate for a 30-year mortgage rose to 6.92%. Along with soaring home prices and elevated mortgage rates, buyers are also facing additional financial pressures from insurance, property taxes, homeowner association fees, and other costs tied to homeownership, all worsened by inflation.
This lack of affordability has led to a significant decline in home sales across the country, marking the steepest drop in eight months. According to Redfin, home sales fell by 0.5% in June on a monthly basis, the largest decline since October 2023. Year-over-year sales decreased by 1.1% and were 21.5% lower than pre-pandemic levels.