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Home sale cancellations hit highest rate since start of pandemic

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Approximately 600,000 home purchase contracts According to a new analysis by Redfin, it failed in June.

This figure is equivalent to 14.9% of homes contracted that month, up from 12.7% in May and 11.2% a year ago.

According to Redfin’s analysis, about 60,000 home purchase contracts were signed nationwide in June, accounting for 14.9% of the homes contracted that month. (Redfin)

The housing market is the percentage in June Onset of COVID-19 pandemic.. Approximately 17.6% of contracted homes went bankrupt in March 2020, and 16.4% of contracted homes went bankrupt in April 2020.

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Taylormer, Deputy Chief Economist at Redfin, believes the June increase was due to slower competition in the home market, giving homebuyers more room to negotiate.

“Buyers are increasingly maintaining, rather than abandoning, inspection and appraisal contingencies, which gives them the flexibility to stop trading if something goes wrong during the home buying process.” Says Ma.

In addition, Mr. Ma said some homebuyers are priced from transactions because of the high interest rates on mortgages.next Raise 75 basis points According to the Federal Reserve System in June 30-year fixed mortgages rose towards 6%.

“We saw many buyers cancel their deals when mortgage rates rose to nearly 6% in June,” said Lindsay Garcia, Miami’s Redfin real estate agent. “Some people had to resign because of soaring interest rates that made them unable to get loans. The economic uncertainty has made buyers more mean than usual,” he said.

Home buyers last week Mortgage rates have dropped to 5.3%. The largest weekly decline since 2008.

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In addition to canceling purchase contracts, homebuilders have seen an increase in cancellations.

According to a survey by John Barnes Real Estate Consulting, the national cancellation rate for homebuilders jumped from 10.4% in May to 14.5% in June from 6.5% a year ago. This number is above the 2018 level, but below the 16.5% cancellation rate hit in April 2020.

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Len Renner Co., Ltd. 78.70 +0.31 + 0.40%

Lennar, which reported a cancellation rate of 11.8% in the second quarter of 2022, said it would adjust prices based on market conditions to increase incentives to compensate for the chill in demand.

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