Buyers are walking away from home purchases in record numbers, causing complete chaos in the US housing market.
In June, over 57,000 home sales across the country were abruptly canceled, equaling a staggering 14.9 percent of homes that went under contract, according to a report from Redfin.
That number is an uptick from 13.9 percent of sales which collapsed this time last year.
It’s also the highest June figure ever recorded since Redfin began tracking cancellations in 2017, and the Sun Belt has become ground zero for cancelled deals.
It’s all down to the buyers, who currently hold the power in the real estate market.
With a surplus of sellers flooding the market and far fewer buyers, Americans looking to buy now have the upper hand, and it seems they’re taking full advantage of it.
Many are pulling out of deals during the inspection phase for two reasons: Sometimes they are identifying real flaws that they worry will cost too much to fix, while other times it is because something better suddenly hits the market.
‘Buyers have leverage,’ said Crystal Zschirnt, a Redfin Premier agent in Dallas.
The Sun Belt has become ground zero for cancelled deals in the US
Pictured: Crystal Zschirnt, a Redfin Premier agent in Dallas
It’s not just pickiness driving the exodus.
The soaring cost of homes, home repair and near-record mortgage payments are also giving Americans cold feet. Some buyers simply balk when they see the reality of their future monthly bills.
‘I’ve also heard of some buyers backing out because they’re hoping home prices or mortgage rates are going to plummet soon, even though that’s unlikely,’ Zschirnt said.
Redfin expects home prices to decline 1 percent year over year nationwide by the end of 2025, and mortgage rates to remain around the 6.8 percent range.
There are also budding homebuyers rattled by bigger picture issues like economic uncertainty, tariffs, stubborn inflation and fears of a looming recession.
Meanwhile, sellers are scrambling to keep deals alive.
‘Sellers are willing to make deals because in today’s buyer’s market, they don’t want to lose out on a sale once they have a buyer under contract,’ said Van Welborn, a Redfin Premier agent in Phoenix.
Jacksonville, Florida, saw a jaw-dropping 21.4 percent of home purchase agreements canceled in June
San Antonio, Texas, has buyers pulling out of home contracts at a rapid rate
The soaring cost of homes, home repair and near-record mortgage payments are causing cold feet in Fort Worth, Texas
Potential buyers are bailing in Las Vegas, Nevada, over bigger picture issues like economic uncertainty, tariffs, stubborn inflation and fears of a looming recession
In Orlando, buyers are also concerned about multiple factors
Tampa, Florida, has seen buyers walking away from home purchases in record numbers, causing complete chaos in the US housing market
‘A few years ago, when the market was more competitive, sellers were able to tell buyers to move on rather than pay for repairs found during the inspection period.
‘Now, sellers are doing whatever they can to close the deal. I have one buyer who discovered a septic issue on an ultra-luxury home and was able to talk the seller into reducing the price by $1 million.’
The majority of cancelled deals are found in the Sun Belt.
Jacksonville, Florida, saw a jaw-dropping 21.4 percent of home purchase agreements canceled in June, the most of the 44 cities included in the study.
It’s similar chaos in Las Vegas, where 19.7 percent of contracts fell through.
In Atlanta, 19.6 percent of buyers cancelled contracts, while San Antonio, Tampa, Orlando, Riverside, Phoenix, Fort Worth and Miami rounded out the top 10.
Redfin links the spike to heavy new construction in those regions – meaning even more choices for buyers – as well as skyrocketing insurance costs driven by natural disasters.
At the other end of the spectrum, Nassau County, New York, saw just 5.4 percent of deals fall through, making it the lowest in the country.
Sellers are doing whatever they can to close the deal in Tampa,Florida
Miami is flooded with homes for sale and no buyers are buying
Fort Worth, Texas, is seeing an uptick in buyers bailing on home sale contracts
Orlando, Florida, has a surplus of homes on the market and buyers are bailing on contracts
Redfin expects home prices to decline 1 percent year over year nationwide by the end of 2025
That was followed by Montgomery County, Pennsylvania, with 6.8 percent of cancellations and Milwaukee with 8.2 percent.
Despite those areas remaining strong, cancellations are rising nearly everywhere else across the US.
Only seven metro areas saw a drop compared to last year, but the changes were minimal.
Fort Lauderdale had the biggest decline, with 16.5 percent of deals canceled down from 17.7 percent, followed by Denver with 16.2 percent down from 17.2 percent.
Orlando is seeing 19 percent contract cancellations, which is slightly down from 19.9 percent.
The steepest year-over-year increases were in California.
Anaheim saw cancellations rise to 15.2 percent from 12.6 percent, and Los Angeles climbed to 17.1 percent from 14.7 percent.
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