Realtors are facing an unprecedented number of buyers backing out of home purchases, largely due to a challenging real estate market that is making buyers more selective.
According to a report by Redfin, nearly 56,000 home-purchase agreements were canceled in June, accounting for 15% of all homes that were under contract during that month. This represents the highest percentage of cancellations 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 rise in cancellations to buyers who are becoming increasingly picky amid soaring housing costs. She noted that many are withdrawing from deals over minor issues, as the ongoing expenses related to home buying have become too significant to overlook.
Rafael Corrales, a Redfin agent in Miami, echoed this sentiment, reporting “nightmare scenarios” involving last-minute withdrawals due to small details. In Miami alone, approximately 2,500 home purchases were canceled in June, representing 17.6% of homes that went under contract. Corrales emphasized that the primary concern for buyers is affordability.
In June, the median home sale price reached a record high of $442,525, and the average rate for a 30-year mortgage was reported at 6.92%. Additionally, prospective homeowners are grappling with increased insurance costs, property taxes, HOA fees, and other expenses related to homeownership, all of which have been compounded by inflation.
This lack of affordability has contributed to a notable decline in home sales nationwide, marking the largest decrease in eight months. Monthly home sales fell by 0.5% in June—the steepest drop since October 2023. Year-over-year, home sales decreased by 1.1% and were 21.5% lower than pre-pandemic levels.