Realtors are facing an increasing number of indecisive buyers as the challenging real estate market prompts people to be more selective in their home purchasing decisions.
According to a report by Redfin, nearly 56,000 home purchase agreements fell through in June, representing 15% of all contracts for that month. This marks the highest percentage recorded by the real estate platform for any June.
Julie Zubiate, a Redfin Premier agent in the San Francisco Bay Area, attributes the surge in cancellations to buyers facing higher costs. “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 noted.
In Miami, Redfin agent Rafael Corrales has reported experiencing “nightmare scenarios,” with last-minute cancellations driven by trivial details. Approximately 2,500 home purchases were canceled in Miami last month, amounting to about 17.6% of homes under contract. However, Corrales emphasized that the primary issue is affordability.
The median home sale price hit a record $442,525 in June, and the average rate for a 30-year mortgage rose to 6.92%. In addition to high home prices and elevated mortgage rates, potential buyers are also weighed down by insurance, property taxes, HOA fees, and other ownership costs that have been heightened by inflation.
The nationwide affordability crisis has led to a significant decline in home sales, which experienced their largest drop in eight months, as reported by Redfin. Home sales decreased by 0.5% from the previous month in June—the steepest fall since October 2023. On a year-over-year basis, sales were down 1.1% and were 21.5% below pre-pandemic levels.