Thousands of Americans Cancel Home Deals in July Amid High Prices

A growing sense of unease is sweeping through the U.S. housing market as a record 60,000 Americans tore up their home purchase agreements in July. With mortgage rates and home prices still hovering near historic highs, and an uncertain presidential election looming, many potential buyers are hitting the brakes.

While existing home sales saw a slight uptick last month, they still marked the lowest level of July sales on record. The drop in activity highlights a market caught between competing pressures: buyers hesitant to lock in deals at current prices and sellers struggling to find willing buyers.

The average interest rate on a 30-year mortgage has dipped to 6.49%, a welcome relief from May’s peak of 7.22%. However, even this slight decrease hasn’t been enough to lure cautious buyers off the sidelines. Many are hoping for further rate reductions before making a move, while others are simply waiting out the market, concerned about paying top dollar in such an uncertain economic climate.

Adding to the anxiety is the looming U.S. presidential election. With potential shifts in policy on the horizon, prospective buyers are wary of making long-term commitments without knowing what the future holds. This caution is further amplified by home prices, which continue to rise. In July, home prices climbed 4.1% year over year, reaching $439,170, according to Redfin.

As the housing market grapples with these dynamics, the record number of canceled deals in July serves as a stark indicator of the uncertainty and caution that now define the landscape. With buyers increasingly unwilling to take the plunge, the question remains: will the market stabilize in the months ahead, or are we in for a more prolonged period of hesitation and retreat?