The share of home-purchase cancellations in the US reached the highest reading in almost three years in July, in what is largely seen as a buyers' market, Redfin.com said Friday.
Roughly 14% of sale agreements that went under contract last month fell through, up from 13.7% in June and marking the highest share since November 2023, according to the online real estate brokerage
Homes that fell out of contract in a given month didn't necessarily go under contract that same month, Redfin said.
The number of homebuyers hit an all-time low in July, while the market had a near-record 51% more sellers than buyers, according to the report.
"That gives house hunters more options and makes them more likely to walk away if an inspection uncovers problems, an appraisal comes in low or the seller doesn't agree to concessions," Redfin said.
Buyers' woes are also compounded by elevated home prices and mortgage rates, the report showed.
"An unexpected repair, a change in financing costs or simply second thoughts about taking on a large monthly payment can be enough to derail a deal -- especially when buyers feel confident another home will come along," Redfin said. "Some house hunters are also changing their minds due to economic uncertainty."
Nearly 20% of home-purchase agreements were canceled in Atlanta last month, the highest share among the 50 most populous US metros. Contract cancellations were least common in Nassau County, New York, with only 3.5% of homebuying deals falling through, according to the report.
"Home-purchase cancellations are most prevalent in buyer-friendly Southern markets, where a lot of inventory and fewer buyers are giving house hunters more confidence to walk away from deals," Redfin said.
Earlier this month, data from the National Association of Realtors showed that existing home sales in the US declined more than expected in July as rising prices and mortgage rates continued to weigh on homebuying activity.
