Pending sales fall flat as property market begins to cool

Redfin says more people are pulling out of pending home sales in places like Oklahoma City and Tulsa as a result of changes starting to take place in real estate markets across the country.(Photo by Dillon Kydd on Unsplash)

Nationwide, including in Oklahoma City and Tulsa, potential homebuyers have recently slowed sales or pulled out entirely as mortgage rates rose and housing shortages began to ease. increase.

About 63,000 home-buying deals failed to close nationwide in July, according to data provided by Redfin. This represents 16.1% of the homes that were contracted that month.

Oklahoma City had 22.7% of its pending sales contracts canceled by the end of the month, while Tulsa had 17.9%, according to online brokerages.

Analysts at Redfin speculate that higher interest rates, which have sidelined many prospective homebuyers, have caused others to reconsider pending deals. Some believe that slowing down sales creates more favorable options and allows them to enjoy more bargaining power when negotiating deals later. Some have begun to provide contingencies in their contracts that allow them to cancel the deal. will likely be canceled, Redfin said in a release.

“As homes have been on the market longer, buyers have found that they have more options and room to negotiate. They want repairs, concessions, contingencies, and if sellers say no , I’m confident we can find something better, so we’re going to pull out and move on,” said Heather Kruayai, a Redfin real estate agent in Jacksonville, Florida. “Buyers are also cautious because they fear a potential recession could drive home prices down. Not wanting to be in a situation, some people choose to wait and hope to buy when the price drops.”

Another Redfin agent, Alexis Malin, said there is no guarantee that buyers will find better deals in the future despite the change in leverage. Annual home price growth has started to slow, from 17% a year ago he’s 8% today.

“Some buyers who are pulling back have a mentality that the market is collapsing and they can get a house for $100,000 less in six months. There’s no limit,” Marin said. “In many parts of Florida, homes are still selling for a lot of money, so we warn buyers that the lawn on the other side may not actually be greener.”

Some buyers may back off with mortgage rates at just over 5%. Those who started their search a few months ago when rates were close to 3% she may have realized that the type of house she previously wanted was out of her budget.

About 800 home purchase contracts were canceled in Jacksonville in July. This represents his 29.3% of the homes that were contracted that month. This was the highest percentage among the 93 US metropolitan areas analyzed. Las Vegas (27.4%) was next. Lakeland, Florida (26.2%); New Orleans (25.9%); San Antonio (25%).

Metro must have at least 1,000 pending home sales in July to be included.

“Home cancellations may start to taper off as sellers get used to the slow-paced market,” said Taylor Ma, deputy chief economist at Redfin. “Sellers have already started lowering prices after they put the homes on the market.

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