Rise in Home Purchase Cancellations
Continued Increase in Home Purchase Agreement Cancellations
August 2024 brought more alarming news for homeowners considering selling their homes. Reports show that 15.7%, or 60,000, home purchase agreements were canceled in August, representing a 14.3% increase from just one year ago. This startling number means nearly one in seven homeowners hoping to close the sale on their homes were left disappointed.
What’s causing these last-minute cancellations in home purchase agreements, and what alternatives do homeowners hoping to sell their homes have? This article addresses these issues to help you better understand available options for selling your home faster and without the hassle of a traditional sale.
What’s Behind the Increase in Home Sale Agreement Cancellations?
Today’s housing market is highly complex, with many moving components. When it comes to home sale agreements, there are several factors impacting the rate of cancellations, including:
- ‘Sticker Shock’ Effect: ‘Sticker shock’ is spurring many potential homebuyers to back out of the sales agreement at the last minute. Once they see exactly what their mortgage payments are, how much interest they owe, and a full calculation of closing costs, some homebuyers simply get cold feet and cancel the sale – even if it’s costing them money.
- High-Interest Rates and Low Inventory: With mortgage rates sitting above 7% for the average 30-year mortgage, homebuyers are going to continue to make these last-minute home purchase agreement cancellations. These higher rates also make many current homeowners hesitant to put their homes on the market because they don’t want to purchase a new home at a higher rate. This low inventory of homes for sale is causing home prices to spike. As long as interest rates remain high and the low housing supply continues to keep home prices up, the phenomenon of homebuyers’ ‘sticker shock’ is not going to end any time soon.
- Home Repair Request: Another factor preventing the finalization of these home purchase agreements is the homeowner’s reluctance to agree to repair requests from potential buyers. For homebuyers already looking at higher mortgage payments, this refusal to make requested home repairs quickly becomes a deal breaker.
To see a significant improvement in the number of home purchase agreement cancellations, all three barriers must be addressed – mortgage rates must fall, the inventory of homes for sale must increase, and homeowners may need to make more concessions to close the deal.
What Alternatives Do Homeowners Have?
The good news is that homeowners have alternative options when it comes to selling their homes. Rather than relying on traditional home selling practices that are leaving many homeowners stuck when the deal falls through, consider working with a cash home buying company, like Homeinc.
These companies can make selling your home quick, easy, and hassle-free. At Homeinc, you work directly with an experienced acquisition manager, who can quickly conduct a property assessment and provide you with an instant cash offer. Closing on your home can occur in as little as five days with cash sent directly to your bank account.
Benefits of Selling Your Home to a Cash-Buying Company
You don’t have to take the risks involved in a traditional home sale or worry about homebuyers backing out of the deal at the last minute. Instead, you can reap the rewards of working with a cash home-buying company. Here’s a look at the top ten benefits of selling your property to a cash home-buying company, such as Homeinc.
- Faster Closing Timeframe: Since working with a cash home-buying company eliminates the need to list your house and wait for the right homebuyer, you can close the deal faster. With Homeinc, you can see a closing time in as little as five days. If you need more time to pack up your belongings, Homeinc offers flexible terms that allow you to select a closing date that best meets your needs.
- Free Property Analysis: When selling your home for cash, be careful. Some cash home-buying companies charge an additional fee for a property analysis – not at Homeinc. It offers a free analysis based on the age of your property, the current market position, required property repairs, and any home ownership complications, such as liens or violations. This free analysis lets you know right from the start how much your home is worth in today’s housing market.
- Money Sent Directly to Your Bank: When selling your home for cash, you receive your money almost instantly. With Homeinc, the money from the sale of your home is directly wired into your banking account at closing, so you can have instant access to the money you need.
- Hassle-Free Sales Transactions: Working with a cash-buying company can make the home selling process quick and hassle free. Not only does it eliminate the need to hire a real estate agent, list your home, host open houses, and schedule tours, but cash home buyers typically handle all the paperwork and documents needed for closing.
- No Required Home Repairs: One of the best benefits of working with a cash home buyer is that home repairs are typically not a condition of the sales transaction. Instead, cash sales are almost always considered an ‘as is’ sale, meaning the buyer is purchasing the property in its current condition. This is a great benefit for homeowners who don’t want to spend extra money making repairs on their homes before selling.
- Keep More Money for Yourself: Not only can you see lower closing costs with a cash sale, but the absence of a real estate agent also means you don’t have to pay commission fees. At the end of the day, these lower fees mean more money in your pocket at the end of the sale.
- No Risk of Last-Minute Cancellations: With home purchase cancellations on the rise, cash sales can be a safer alternative for sellers. You don’t have to worry about homebuyers having last-minute financing issues, making costly home repair requests, or getting cold feet and canceling the deal. With a cash sale, once a deal is made, you can rest assured that closing will be quick and free from any last-minute hassles.
- Avoid Foreclosure with a Fast Sale: If your home is close to foreclosure, a traditional sale may take too long. Even if you’re able to find a potential buyer, there’s no guarantee they won’t back out at the end, leaving you stuck with no viable options. A cash home-buying company can prepare for closing in as little as five days. This fast sales process can prevent a foreclosure listing on your credit report, which could jeopardize your ability to purchase another home in the future.
- Fair Pricing: While a cash sale for your home has many advantages, it’s still important to make sure you deal with a reputable cash home-buying company. Not every company offers fair home prices, which can limit the amount of cash you get back. Homeinc prides itself in making competitive offers that are fair to the homeowners. Most importantly, Homeinc makes no-obligation offers, so you are never stuck accepting an offer that isn’t right for you.
- Skip the Staging Process: Since you won’t be listing your home for sale or having showings or open houses, you can skip the staging process altogether. You don’t have to pay for storage to hold some of your clutter, move furniture around, or give your walls a fresh coat of paint to give your house the ‘right’ look. None of these steps are necessary when it comes to cash sales. These purchases are made ‘as is,’ so all you need to do is pack up your belongings and move to your next home.
Contact Homeinc Today
If you’re interested in selling your home, but don’t want the hassle and risks involved in a traditional home sale, contact our team at Homeinc today. One of Homeinc’s experienced acquisition managers can quickly conduct a property assessment and send you a cash offer.
Best of all, we offer flexible terms that allow you to determine the closing date if you need more time to move out before officially closing the sale. Homeinc works with homeowners throughout Georgia and Florida, even those with special challenges, such as tenants still living in the home, liens, and violations. Homeinc buys single-family homes, multi-family homes, condominiums, townhouses, mobile homes, vacant lots, and more.
Contact Homeinc today to learn more about our cash home buying process or to request a quick cash offer.