Even as financial pressure mounts, most homeowners remain committed to making rising costs work, highlighting the persistent value and challenges of homeownership.
According to a new data from Redfin, the real estate brokerage powered by Rocket, just over 57,000 home-sale agreements nationally were canceled in June, which equates to 14.9% of homes that went under contract during that month. Since 2017, that June share has been the largest, up from 13.9% the year before.
“Buyers have leverage,” said Crystal Zschirnt, a Redfin Premier agent in Dallas. “Some buyers are canceling deals because another home pops up in the same price range that they like better, or because they discover a flaw and get nervous it’ll cost too much to fix. 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.”
Due in large part to the buyer’s market, pending home sales are failing at a higher rate than in the past. Because there are hundreds of thousands more home sellers than buyers in the United States, buyers have more options and bargaining power. Buyers can be picky; if they find a problem they don’t want to fix or a better house comes up for sale, they may back out during the inspection period.
The other main reason why purchasers are pulling out of negotiations is financial. Although monthly mortgage payments have somewhat decreased, they are still close to their all-time high, and home-sale prices in the United States are at record highs. When the reality of their monthly payment settles in, some prospective buyers are canceling their purchases. Furthermore, according to Redfin agents, some buyers are canceling because they are anxious about the state of the economy, including uncertainties about tariffs, inflation, and the potential for a recession.
By the end of 2025, Redfin predicts that mortgage rates will essentially stay in the 6.8% area while home prices would fall 1% annually countrywide.
Sometimes sellers put a lot of effort into preventing transactions from failing.
“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. “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.”
In June, more than one in five (21.4%) home-purchase agreements in Jacksonville, Florida, were canceled. This was the highest percentage among the 44 major U.S. metros that Redfin examined. Las Vegas (19.7%) and Atlanta (19.6%) come next.
San Antonio, Tampa, Florida, Orlando, Florida, Riverside, California, Phoenix, Fort Worth, Texas, and Miami complete the top 10 metro areas with the highest cancellation rates, all of which are located in the Sun Belt. Due in part to the abundance of new development, which gives purchasers even more options, cancellations are particularly prevalent in Florida and Texas. Due to exorbitant insurance estimates associated with the rising frequency of natural disasters, several buyers in such locations are pulling out.
On the other hand, Nassau County, NY had the lowest percentage of home-purchase agreements terminated in June (5.4%), out of all the metros Redfin examined. Milwaukee (8.2%) and Montgomery County, PA (6.8%) come next.
In California, contract cancellations have increased most significantly from year to year: in Anaheim, 15.2% of deals were canceled, up from 12.6%, and in Los Angeles, 17.1%, up from 14.7%.
Only seven of the metros in this analysis saw a decline in the percentage of home-purchase cancellations in June compared to the previous year, all by less than one percentage point. Denver (16.2%, down from 17.2%) and Orlando, FL (19%, down from 19.9%) saw the largest declines, followed by Fort Lauderdale, FL (16.5%, down from 17.7%).
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