26% of Southwest Florida home buyers cancel contracts

LABELLE, FL. — According to a report released today by red fin, one in four homebuyers in the Cape Coral area are canceling existing contracts to buy homes. And across Florida, buyers are canceling contracts at a similar rate, with more buyers backing down than any other state.

Redfin says: “Some homebuyers are pulling out of deals because the housing market downturn is giving them more room to negotiate. Others are being forced to back out of contracts because higher mortgage rates mean some homes aren’t more affordable.

“This is the highest percentage on record except for March and April 2020, when the housing market came to a virtual standstill due to the onset of the coronavirus pandemic.”

As interest rates rise to 5% or more, some buyers cannot afford the monthly mortgage payments at the new rate or may no longer qualify for financing.

In the LaBelle area, homebuilders like Heartland Homes of Florida and Standard Land Development (sold through MJ Newell Homes) have asked contract buyers to pay tens of thousands of dollars more than their contract price last year. , forcing some to cancel the sale and recover their deposits from the home builder.

Others in Hendry County and Glades were luckier and were able to qualify for USDA rural development home loans, with little or no down payment and interest rates stuck at around 3% .

Drone Photography by Don Browne – Construction of Banyan Village in Port LaBelle, Florida