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Rising home prices and stubborn mortgage rates are leading a growing number of homebuyers to abandon their home purchasing plans, according to a Redfin report published Tuesday.

In June, median home prices increased 4 percent year over year to an all-time high of $442,525 as 30-year mortgage rate averages hovered just under 7 percent. Those conditions led homebuyers to cancel 56,000 home-purchase agreements — or 14.6 percent of the pending sales for the month.

Florida bore the brunt of the rise in home-purchase cancellations, with more than a fourth of for-sale inventory in Orlando (20.8 percent), Jacksonville (20.5 percent) and Tampa (20.5 percent) falling out of contract in June. Homebuyers in Las Vegas (20.2 percent) and San Antonio (19.9 percent) were also skittish, with roughly 20 percent of contracts kicking the can at the peak of the summer homebuying season.

Rafael Corrales

Redfin Premier agents Rafael Corrales and Julie Zubiate said affordability concerns are the primary culprit, with insurance, property taxes and homeowners association fees giving homebuyers serious sticker shock.

“Buyers often back out during the inspection period because they find something they don’t like, but affordability is really the underlying issue,” he said. “I don’t want my buyers to be surprised by all of the expenses that come with owning a home in Florida, so I advise them to proactively research the hefty costs of insurance, property taxes and HOA fees, in addition to the cost of their mortgage payment.”

Meanwhile, Zubiate said Bay Area buyers have become increasingly picky — a 180 from the pre-pandemic and peak-pandemic trends when homebuyers entered bidding wars for fixer-uppers and even half-burnt lots.

Julie Zubiate

“Buyers are getting more and more selective,” she said. “They’re backing out due to minor issues because the monthly costs associated with buying a home today are just too high to rationalize not getting everything on their must-have list.”

Although homebuyers’ worries got the best of them in June, the report said home purchase cancellations could soon improve as homesellers face longer list-to-sell timelines. Nearly 20 percent of homes (19.8 percent) experienced a price cut in June — the highest rate for the month since 2017.

“Some sellers are reducing their prices because their homes are sitting on the market and getting stale — the result of an ongoing affordability crisis impacting buyers,” the report read. “The typical home that sold in June spent 32 days on the market, the longest of any June since 2020. That’s up three days from a year earlier — the biggest annual increase since last summer.”

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Leading LA luxury broker Tyrone McKillen is bidding adieu to Official after spending less than two years with the brokerage, Business Insider first reported.

In early 2023, McKillen joined Official to spearhead the firm’s expansion into Los Angeles. At that time, McKillen brought over $500 million in listings with him, as well as his eight-person team, Plus Real Estate Group.

Official has confirmed that McKillen and his team will be leaving the brokerage.

“We have a deep amount of respect for Tyrone and support him in his new venture,” Nicole Oge, co-founder and chief growth officer at Official, said in a statement to the Real Deal.

Official and McKillen did not immediately respond to a request for comment from Inman. McKillen also did not respond to a request for comment from The Real Deal.

The move comes just weeks after Official co-founders and brothers Oren and Tal Alexander stepped down from their positions at the firm in response to mounting lawsuits alleging the brothers and their other brother, Alon Alexander, were perpetrators of rape and sexual assault.

Following McKillen’s departure, it is unclear in what capacity Official will continue to operate in Los Angeles.

McKillen’s exit will likely be a setback in terms of Official establishing itself in LA’s luxury market, which is full of competitive boutique firms and larger household names alike.

Currently, McKillen holds a mix of for sale and for rent listings representing more than $100 million in volume, according to his online profile.

The broker also founded and serves as principal of Plus Development Group, a LA-headquartered development and design firm, of which his team is also a part.

Last week, Tal Alexander denied the rape and assault allegations against him through a court filing made by his attorneys, who said they would push for a jury trial in their continuing fight against the allegations.

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Email Lillian Dickerson