Realtors are experiencing a surge in hesitant buyers as individuals become increasingly selective amid a challenging real estate market. According to a Redfin report released on Tuesday, nearly 56,000 home-purchase agreements fell through in June, accounting for 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 rise in buyer withdrawals to heightened selectivity in a costly 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 stated.
Rafael Corrales, a Redfin agent in Miami, reported troubling trends, including last-minute cancellations over minor details. Approximately 2,500 home purchases in Miami were canceled last month, which is about 17.6% of homes that went under contract in June. Corrales noted that the primary concern remains affordability.
The median home sale price hit a record $442,525 in June, while the average rate for a 30-year mortgage stood at 6.92%. In addition to high home prices, prospective buyers are also facing rising insurance costs, property taxes, HOA fees, and other expenses associated with homeownership, all further worsened by inflation.
This lack of affordability has contributed to the most significant decline in home sales nationwide in the past eight months, according to Redfin. Monthly home sales fell by 0.5% in June, representing the largest drop since October 2023. Year-over-year, home sales decreased by 1.1%, and they are now 21.5% below pre-pandemic levels.