Realtors are facing an increasing number of uncertain buyers as the real estate market becomes more challenging, with potential homeowners becoming more selective in their choices.
A recent report from Redfin indicates that nearly 56,000 home purchase agreements were canceled in June, representing 15% of all homes that went under contract that month. This figure marks the highest cancellation rate recorded for June in Redfin’s history.
Julie Zubiate, a real estate agent with Redfin Premier in the San Francisco Bay Area, attributes this spike in cancellations to buyers being more particular, especially in a market with higher costs. She noted that customers are withdrawing from deals over minor issues due to the steep monthly expenses associated with homeownership.
Rafael Corrales, another Redfin agent based in Miami, described seeing “nightmare scenarios” unfold, including last-minute withdrawals for trivial details. In Miami, approximately 2,500 home purchases were canceled last month, translating to around 17.6% of all homes that went under contract in June. Corrales emphasized that the main concern is the affordability of homes.
The median home sale price in June reached an unprecedented $442,525, while the average rate for a 30-year mortgage stood at 6.92%. Besides the high property prices and soaring mortgage rates, potential buyers are also overwhelmed by additional costs, including insurance, property taxes, and homeowners’ association fees, all of which have been heightened by inflation.
The overall lack of affordability in the housing market across the country has led to a significant downturn in home sales, according to Redfin. Monthly home sales decreased by 0.5% in June, marking the largest drop since October 2023. Year-over-year, home sales dropped by 1.1% and were 21.5% lower than pre-pandemic levels.