Realtors are encountering an increasing number of indecisive buyers as the real estate market becomes more challenging.
According to a report from Redfin, nearly 56,000 home-purchase agreements were terminated in June, which represents 15% of all homes that were under contract that month. This marks the highest percentage recorded for any June since the site’s inception.
Julie Zubiate, a Redfin Premier real estate agent based in the San Francisco Bay Area, attributes the uptick in buyer hesitancy to a more discerning clientele facing elevated market prices. “Buyers are withdrawing due to minor issues, as the monthly expenses of purchasing a home today are too high to overlook without securing all items on their must-have list,” Zubiate explained.
Rafael Corrales, another Redfin agent in Miami, reported witnessing “nightmare scenarios,” including last-minute cancellations over trivial details. In Miami alone, around 2,500 home purchases were canceled last month, equating to roughly 17.6% of homes that went under contract in June. Corrales indicated that the primary concern for buyers 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%. Besides the high home prices and elevated mortgage rates, potential buyers are also burdened by additional costs such as insurance, property taxes, HOA fees, and the overall expenses of homeownership, which have been intensified by inflation.
This lack of affordability in the national market has led to a significant decline in home sales, the largest in eight months, according to Redfin. Monthly home sales decreased by 0.5% in June, marking the steepest drop since October 2022. Compared to the same period last year, home sales fell by 1.1% and are 21.5% lower than pre-pandemic levels.