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By Hugh Cameron
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The number of pending home sales that fell through hit record-levels for the month of June in 2025, as surging inventory and economic uncertainty continues to plague sellers.
According to analysis by real estate firm and brokerage Redfin, over 57,000 home-sale agreements across the U.S. were cancelled in June, equating to around 15 percent of houses that were under contract in the month. This is up from 14 percent a year ago, and marks the highest cancellation rate for any June on record.
Why It Matters
Redfin said in its analysis that record levels of home sales falling through serves as a reflection of persistent economic unease among buyers, as well as the issues of affordability, inflation and high mortgage rates that may be weighing on their minds. The increased fiscal risks associated with homeownership have also contributed to rising levels of inventory, reducing sellers' leverage and putting power over the housing market more firmly in the hands of prospective buyers.
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What To Know
Real estate agents who spoke to Redfin said buyers are becoming reluctant to finalize purchases due to economic uncertainties, in particular high mortgage rates, the potential impacts of tariffs, inflation and the possibility of a recession in the near future. Others noted that surging levels of inventory have put power in the hands of buyers, leading many to cancel deals when another home within their price range is listed.
According to Realtor.com's June Housing Market Trends Report, the number of homes for sale in the U.S. rose nearly 30 percent year-over-year, marking the 20th consecutive month of increases. The latest market report from Zillow, and recent data from the St. Louis Fed, similarly showed that housing inventory has risen to post-Covid highs.
Analysis from Redfin in May said that high levels of inventory, coupled with subdued demand, had led to a buyer surplus of nearly 500,000. It said that this marks the largest gap between buyers and sellers since 2013.
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Despite buyers having greater choice, high prices, mortgage rates, and economic uncertainties have continued to sideline buyers and weigh on home sales in 2025. According to data released Wednesday by the National Association of Realtors, existing home sales fell by 2.7 percent in June to a nine-month low of 3.9 million. Median home prices also rose to $435,300, marking a record high for June and the 24th consecutive month of year-over-year increases.
Prior to the release, President Trump on Tuesday blamed persistently weak home sales on Federal Reserve Chair Jerome Powell, and the central bank's reluctance to lower interest rates, which would likely contribute to mortgage rates declining.
"People aren't able to buy a house because this guy is a numbskull," Trump told reporters in the Oval Office. "He keeps the rates too high."
What People Are Saying
Crystal Zschirnt, a Redfin Premier agent in Dallas, said: "Buyers have leverage. Some buyers are canceling deals because another home pops up in the same price range that they like better, or because they discover a flaw and get nervous it'll cost too much to fix. I've also heard of some buyers backing out because they're hoping home prices or mortgage rates are going to plummet soon, even though that's unlikely."
Nancy Vanden Houten, Lead Economist at Oxford Economics, in comments shared with Newsweek on June's home sales data: "Existing home sales were weaker than expected in June, but we don't think the decline marks the start of a sustained downturn in sales. We look for sales to move sideways over the balance of 2025, before recovering in 2026 as rate cuts by the Federal Reserve get underway in earnest."
"Increases in supply should temper home price growth and support sales. Median home prices rose to a record high in June, but the increase was at least partly due to seasonal quirks and we think price growth will trend lower in the second half of this year," she added.
What Happens Next?
According to Redfin's forecasts, home prices are expected to decline one percent by the end of the year compared to 2024. Despite hopes of mortgage rates soon dropping to six percent, which analysts believe could inject much-needed momentum into U.S. home sales, it anticipates these remaining effectively unchanged at around 6.8 percent.
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