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Record cancellations lead to falling house prices

In June, over 57,000 home sales in the US were canceled, creating market upheaval.

July 24, 2025 at 03:44 PM

House price DROP imminent across all of America: Sales collapse at highest rate on record... with these cities at epicenter

The US housing market faces turmoil as over 57,000 home sales were canceled in June.

House prices set to drop amid record contract cancellations

In June, the US housing market witnessed an unprecedented wave of cancellations, with over 57,000 home sales aborted, representing a striking 14.9 percent of all homes under contract. This uptick from 13.9 percent in the previous year signals a significant shift in buyer behavior. As sellers flood the market and buyers gain leverage, many potential purchasers are reevaluating their commitments. Factors like soaring home prices, escalating repair costs, and high mortgage rates are driving buyers to withdraw. Regions like Jacksonville, Florida, and Las Vegas, Nevada, are particularly hard-hit, showing cancellation rates of 21.4 percent and 19.7 percent respectively. Redfin forecasts that home prices may decline by 1 percent year over year nationwide by the end of 2025, while mortgage rates remain around 6.8 percent, leaving buyers cautious about their investments.

Key Takeaways

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Over 57,000 home sales in June were canceled, marking a 14.9 percent cancellation rate.

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This represents the highest June cancellation rate recorded since Redfin began tracking in 2017.

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Buyers are pulling out due to high home prices, mortgage rates, and repair costs.

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Regions like Jacksonville and Las Vegas are witnessing the highest contract cancellation rates.

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Redfin predicts a 1 percent decline in home prices nationwide by late 2025.

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Negotiations are shifting as sellers become more flexible to avoid losing deals.

"Buyers have leverage, especially in today's market."

Crystal Zschirnt, a Redfin Premier agent, highlights the power buyers now hold.

"Many buyers are hoping home prices will plummet, even though that's unlikely."

Crystal Zschirnt emphasizes the unrealistic expectations of some buyers in the current market climate.

"Sellers are doing whatever they can to close the deal."

Van Welborn notes the willingness of sellers to negotiate under current market conditions.

"Cancellations are rising nearly everywhere across the US."

The significant trend of cancellations indicates widespread market instability.

The recent surge in contract cancellations exposes the volatility in the US housing market. Buyers, now armed with a plethora of options, are withdrawing from deals that no longer meet their expectations. Economic uncertainty, coupled with rising living costs, has made many think twice about their future financial commitments. The growing trend is not merely a passing phase; it reflects broader economic concerns, including inflation and fears of recession. As a result, sellers are increasingly compelled to negotiate, a stark contrast to the market's prior competitive stance where buyers had less leverage. This evolving dynamic might reshape market conditions significantly in the coming months.

Highlights

Buyers are now armed with choices and leverage in the market.
Sellers are increasingly forced to negotiate to keep deals alive.
The reality of future bills has buyers thinking twice.
A stark shift has taken place from sellers having the upper hand.

Potential implications of rising market cancellations

The continuous increase in home sale cancellations may lead to a significant downturn in housing prices, affecting various economic sectors linked to real estate. Buyers' hesitance could spark political backlash as communities grapple with a weakened housing market.

The future of the housing market remains uncertain, heavily influenced by economic trends and buyer behavior.

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housing market real estate cancellations mortgage rates economic uncertainty real estate economy housing market

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