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- Redfin reports 4 of the 10 metros where contract cancellations were most common in May were in Texas, and three were in Florida; all are strong buyer\u2019s markets<\/i><\/li>\n
- Nationwide, 13.6% of the homebuying deals made in May fell through. That share has held steady over the last 4 months as buyers and sellers grow accustomed to today\u2019s market.<\/i><\/li>\n<\/ul>\n
SEATTLE–(BUSINESS WIRE<\/a>)–
\nCancellations of contracts to buy homes are most common in Atlanta, Fort Worth, TX and Jacksonville, FL. In each of those places, roughly 18% of all home-sale agreements that went under contract in May fell through, according to a new report<\/a> from Redfin<\/a>, the real estate brokerage powered by Rocket.<\/p>\n\nNationwide, the portion of buyers backing out of contracts is smaller: 13.6% of May\u2019s home-sale agreements fell through. That\u2019s unchanged from a month earlier on a seasonally adjusted basis, and it\u2019s the fourth month in a row that contract cancellations have held steady at the same rate.<\/p>\n
\nThe share of U.S. homebuying deals that have fallen through has been fairly stable for the last two years, swinging between 13.4% and 14%.<\/p>\n
\nThe fact that contract cancellations have steadied nationwide suggests that while affordability challenges continue to sideline some buyers, others have adjusted to higher mortgage rates. The weekly average rate has been over 6% for nearly four years, since late 2022.<\/p>\n
\nCancellations have inched down from their 2023 peak as buyers and sellers enter transactions with more realistic expectations. More sellers have come to terms with the fact that it\u2019s a buyer\u2019s market in most of the country. Many of them are pricing lower from the start, some are willing to lower their asking price to attract buyers, and some are willing to negotiate to keep deals together. And buyers have generally become more accustomed to high housing payments.<\/p>\n
\nStill, deals are falling apart at a higher rate than they were in 2020-2022, when the U.S. was in a red-hot seller\u2019s market. That\u2019s because there are hundreds of thousands more home sellers<\/a> than buyers, giving buyers the option to back out if they find a home they like better. House hunters are also sometimes changing their minds due to financial instability caused by geopolitical turmoil, like the Iran war, and economic uncertainty, like inflation risk and lack of job security.<\/p>\n
Atlanta and Other Sun Belt Metros Lead the Nation in Canceled Deals<\/b><\/p>\n
\nDeals are falling apart at a higher rate in certain parts of the country. They\u2019re most prevalent in Atlanta and parts of Florida and Texas, as those places complete their one-eighty from pandemic homebuying hotspots to the strongest buyer\u2019s markets<\/a> in the nation.<\/p>\n
\nIn Atlanta, 18.8% of home-purchase agreements were canceled in May, the highest share among the 50 most populous U.S. metros with sufficient data. It\u2019s followed by four other southern metros: Fort Worth, TX (18.1%), Jacksonville, FL (17.9%), San Antonio (17.8%) and Orlando, FL (17.7%).<\/p>\n
\nAll in all, Texas was home to four of the 10 places where contract cancellations were most common, and Florida was home to three.<\/p>\n
\n\u201cSellers need to pay attention and price realistically, because the market is leaning toward buyers,\u201d said Connie Durnal<\/a>, a Redfin Premier<\/a> agent in Dallas. \u201cI recently worked with smart sellers who knew how to get their home under contract and get the deal done: They had paid $400,000 for the home, but they listed at $390,000 because that\u2019s where the market was. They were willing to consider offers under the list price and negotiate with buyers, too.\u201d<\/p>\n
- Nationwide, 13.6% of the homebuying deals made in May fell through. That share has held steady over the last 4 months as buyers and sellers grow accustomed to today\u2019s market.<\/i><\/li>\n<\/ul>\n
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