Buyers are reclaiming their power—and cancelling deals at a growing rate.
According to just-released numbers from Redfin, 16.1 percent of home purchase contracts were cancelled last month, marking the highest rate in two years. An examination of the MLA found that roughly 63,000 home-purchase agreements fell through in July, though not all of those home necessarily went into contract within the same month.
The data point is up from a revised rate of 15 percent in June and 12.5 percent one year earlier.
Some buyers may be backing out due to 5%-plus mortgage rates, while others are using contingency clauses to cancel deals.
“Home-purchase cancellations may begin to taper off as sellers get used to a slower-paced market,” said Redfin Deputy Chief Economist Taylor Marr. “Sellers have already begun to lower their prices after putting their homes on the market. They’ll likely start pricing their properties lower from the get-go and become increasingly open to negotiations.”
Jacksonville and Las Vegas saw the highest rate of home-purchase cancellations in July. In fact, of the top 10 areas with the most called-off deals, Florida cities claimed six spots.
No California cities made the list.