Redfin reports about 56,000 home purchases were
canceled, equal to 15% of homes that went under contract—the
highest percentage of any June on record
(NASDAQ: RDFN) — Deals to purchase homes are falling through at
a record rate as high housing costs give buyers cold feet,
according to a new report from Redfin (redfin.com), the
technology-powered real estate brokerage. Nearly 56,000
home-purchase agreements were canceled in June, equal to 14.9% of
homes that went under contract that month—the highest percentage of
any June on record.
House hunters are having trouble committing because buying a
home is more expensive than ever. The median home sale price rose
4% year over year to a record $442,525 in June, and the average
interest rate on a 30-year mortgage was 6.92%. While that’s down
slightly from 7.06% the prior month, it’s still more than double
the all-time low hit during the pandemic.
“Buyers are getting more and more selective,” said Julie
Zubiate, a Redfin Premier real estate agent in the San Francisco
Bay Area. “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.”
June 2024 Housing Market Highlights: United States
June 2024
Month-over-month change
Year-over-year change
Median sale price
$442,525
0.9%
4.0%
Homes sold, seasonally adjusted
417,179
-0.5%
-1.1%
Total homes for sale, seasonally
adjusted (active listings)
1,636,110
-0.1%
12.8%
Months of supply
2.6
0.2
0.7
Median days on market
32
1
3
Share of for-sale homes with a price
drop
19.8%
1.7 ppts
5.4 ppts
Share of homes sold above final list
price
35.1%
0.0 ppts
-4.5 ppts
Average sale-to-final-list-price
ratio
99.9%
0.1 ppts
-0.4 ppts
Pending sales that fell out of
contract, as % of overall pending sales
14.9%
0.3 ppts
0.2 ppts
Average 30-year fixed mortgage
rate
6.92%
-0.14 ppts
0.21 ppts
Three Florida Metros Led the Nation in Home-Purchase
Cancellations
In Orlando, about 900 home-purchase agreements were canceled in
June, equal to 20.8% of homes that went under contract that
month—the highest percentage among the 50 most populous U.S.
metropolitan areas. Next came Jacksonville (20.5%), Tampa (20.5%),
Las Vegas (20.2%) and San Antonio (19.9%).
“We’re seeing nightmare scenarios where deals are getting
canceled at the last minute for the most minute reasons,” said
Rafael Corrales, a Redfin Premier agent in Miami, where roughly
2,500 home purchases were canceled in June—equal to 17.6% of homes
that went under contract. “Buyers often back out during the
inspection period because they find something they don’t like, but
affordability is really the underlying issue. I don’t want my
buyers to be surprised by all of the expenses that come with owning
a home in Florida, so I advise them to proactively research the
hefty costs of insurance, property taxes and HOA fees, in addition
to the cost of their mortgage payment.”
Nearly 1 in 5 Sellers Dropped Their Asking Price as Homes Sat
on the Market—the Highest June Rate on Record
Roughly one in five (19.8%) homes for sale in June had a price
cut—the highest level of any June on record. That’s up from 14.4% a
year earlier and is just shy of the 21.7% record high set in
October 2022.
Some sellers are reducing their prices because their homes are
sitting on the market and getting stale—the result of an ongoing
affordability crisis impacting buyers. The typical home that sold
in June spent 32 days on the market, the longest of any June since
2020. That’s up three days from a year earlier—the biggest annual
increase since last summer. Listings are piling up as a result;
active listings, or the total number of homes for sale, were little
changed from a month earlier but jumped 12.8% from a year
earlier—the largest annual gain on record.
U.S. Home Sales Posted the Biggest Monthly Decline Since
October
Home sales fell 0.5% month over month in June on a seasonally
adjusted basis. While that may seem like a small decline, it’s the
biggest since October 2023. Home sales dropped 1.1% from a year
earlier and were 21.5% below pre-pandemic (June 2019) levels.
Sales are sluggish because many Americans can’t afford to buy
homes. While mortgage rates ticked down in June (and have fallen
further this month), some buyers are waiting on the sidelines in
hopes that they’ll drop even more. But those buyers may be waiting
in vain, said Redfin Economics Research Lead Chen Zhao, as rates
are unlikely to fall much in the next few months, and markets have
already priced in a September rate cut.
Metro-Level Highlights: June 2024
- Prices: Median sale prices rose most from a year earlier
in Anaheim, CA (13.2%) Newark, NJ (12.6%) and Nassau County, NY
(12%). They fell in four metros, all of which are in Texas: Austin
(-5.5%), Dallas (-1.6%), San Antonio (-1.3%) and Fort Worth
(-0.2%).
- Price cuts: In Indianapolis, 49.2% of listings had a
price drop—a higher share than any other metro Redfin analyzed.
Next came Denver (46.6%) and Tampa (43%). The lowest shares were in
Newark (15.2%), Chicago (16.3%) and Milwaukee (17%).
- Active listings: Active listings rose most in Tampa
(47%), Fort Lauderdale, FL (45.3%) and Orlando (41.4%). They fell
most in Chicago (-7.4%), New Brunswick, NJ (-7%), Chicago (-7.3%)
and New York (-5.8%).
- Closed home sales: Home sales rose in just one metro:
San Jose, CA (1.8%). They fell least in Portland, OR (-3.2%),
Oakland, CA (-3.7%) and San Diego (-5%), and fell most in West Palm
Beach, FL (-23.5%), Fort Lauderdale (-23%) and Virginia Beach, VA
(-17.7%).
- Sold above list price: In San Jose, 72.1% of homes sold
above their final list price, the highest share among the metros
Redfin analyzed. Next came Newark (71.7%) and Oakland (63.1%). The
shares were lowest in West Palm Beach (7.3%), Miami (11.4%) and
Fort Lauderdale (12.3%).
To view the full report, including charts, please visit:
https://www.redfin.com/news/home-purchase-cancellations-june-2024
About Redfin
Redfin (www.redfin.com) is a technology-powered real estate
company. We help people find a place to live with brokerage,
rentals, lending, title insurance, and renovations services. We run
the country's #1 real estate brokerage site. Our customers can save
thousands in fees while working with a top agent. Our home-buying
customers see homes first with on-demand tours, and our lending and
title services help them close quickly. Customers selling a home
can have our renovations crew fix it up to sell for top dollar. Our
rentals business empowers millions nationwide to find apartments
and houses for rent. Since launching in 2006, we've saved customers
more than $1.6 billion in commissions. We serve more than 100
markets across the U.S. and Canada and employ over 4,000
people.
Redfin’s subsidiaries and affiliated brands include: Bay Equity
Home Loans®, Rent.™, Apartment Guide®, Title Forward® and
WalkScore®.
For more information or to contact a local Redfin real estate
agent, visit www.redfin.com. To learn about housing market trends
and download data, visit the Redfin Data Center. To be added to
Redfin's press release distribution list, email press@redfin.com.
To view Redfin's press center, click here.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240723716832/en/
Contact Redfin Redfin Journalist Services: Ally Braun,
206-588-6863 press@redfin.com
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