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Home sale cancellation rates surge in Sun Belt pandemic boomtowns

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As the housing market cools, prospective homebuyers in the once-red-hot Sun Belt are withdrawing purchase commitments in droves, according to a Redfin analysis released Monday.

About 64,000 home purchase contracts were canceled in August, according to data. put together by a real estate companyThat total amounted to 15.2% of all homes contracted last month.

of ‘Pandemic boomtown’ has the highest cancellation rate Located in the Sunbelt Province. All 10 cities with exit rates of 20% or more were located in this region.

Jacksonville, Florida outperformed all other cities with 26.1% of pending sales dropped from contracts in August. Las Vegas, Nevada has 23%, followed by Atlanta with 22.6%, Orlando with 21.9% and Fort Lauderdale with 21.7%.

“The slowdown in the housing market means that buyers won’t have to give up key contingent contracts to compete like last year’s homebuying frenzy, so buyers can scrap deals.” said Redfin in a blog post about trends.

Sun Belt boomtowns such as Phoenix are seeing a housing slowdown.
Bloomberg via Getty Images

The Sun Belt is a broad term for states located in the lower third of the United States and known for their temperate climate.

Across the U.S., cancellation rates have exceeded 15% in the past three months, according to Redfin. This is the highest number ever, aside from the upheaval that occurred in his first two months of the COVID-19 pandemic in March 2020 and his April.

Redfin noted the lowest rates in many cities where workers are returning to the office after months of remote work. For example, last month in New York, only 7% of home-buying contracts were canceled.

Tampa Bay
Many of the cities with the highest cancellation rates are in Florida.
Christopher Sadowski

The surge in mortgage rates has effectively put the brakes on buying activity in many markets, especially those where home prices have skyrocketed during the pandemic-era housing boom. 30-year fixed-rate mortgages hit 6.29% last week, up 3.41% from the same week a year ago, according to Freddie Mac.

“Some homebuyers realize that by the time they sign the contract and lock in the interest rate on their mortgage, the interest rate could be much higher than when they saw the home or obtained pre-approval. Buyers are no longer financially happy with their purchases, which can ruin the deal,” said Sam Shute, a Miami-based real estate agent for Redfin. .

As The Post reported, home prices are starting to fall in the overheated market, with sellers cutting back on demands to lure buyers.One expert said that the price Can drop up to 20% Fixing the housing.

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