A record 60,000 home deals fell through in July amid election fears

A record 60,000 home buyers closed on their deals in July, breaking previous records, according to a new report.

This mass exodus, accounting for 16% of all contracts signed that month, is the highest July cancellation rate since Redfin began tracking this data in 2017.

The carnage was most brutal in regions where builders have been rampant in recent years, flooding the market with new homes. Tampa and Fort Lauderdale in Florida, and San Antonio in Texas, led the charge with the highest rate of broken deals, according to Redfin.

As inventories increased, retailers were forced to swallow their pride and lower prices.

Zillow reported that over 26% of homes on the market in July saw price reductions, the most since 2018. For those still in the game, this oversupply brings opportunities – not only in negotiating prices, but also by squeezing commissions. lower ones.

So what’s driving this buyer’s remorse?

Despite falling mortgage rates, other factors are causing potential homeowners to hold back. Biggest concerns? High house prices and the looming uncertainty of the upcoming presidential election.

“When rates finally came down, buyers got excited and we saw more activity,” said Nicole Stewart, a real estate agent with Redfin in Boise, Idaho. But now, she says, many are resting because “a lot of people are also worried about the political climate.”

Stewart added that even those who can afford a home “are holding back because it’s unclear where the country is going to be in six months.”

Worry about politics isn’t entirely new, but it’s taking a noticeable toll on the market this year. While presidential elections typically don’t directly determine home prices, they tend to cause a pre-election cooling in sales.

In nine of the last 11 elections, home sales increased in the year after the votes were counted.

“Although in reality, who’s in the Oval Office probably won’t have much of an impact on the housing market,” Stewart said.