The Real Estate Market Is Shifting

The Real Estate Market Is Shifting — And Sellers Are the Ones to Watch

Right now, everyone’s talking about buyers. But the real shift in today’s real estate market? It’s happening on the seller side.

For months, we’ve heard the narrative: “Inventory is piling up, a crash is coming.” But when you look closely, that’s just not what the numbers are saying anymore. Sellers aren’t flooding the market—they’re pulling back. And that’s changing everything.

Listings Are Dropping—Here’s Why

In June, we saw 517,000 new listings. That’s down 3% from May and 3.5% year-over-year. And it’s not a fluke. It’s a clear signal: sellers aren’t under pressure the way they were in 2008.

Here’s the reality: most homeowners today don’t need to sell. They’re sitting on low-interest loans, massive equity, or they own their homes outright. So unless they’re going through a divorce, a relocation, or need that equity for something urgent—they’re waiting.

Many bought homes at 3% interest. Why would they sell, then turn around and buy at 7%? The math doesn’t make sense. That’s why we’re seeing contingent buying, delisting, and sellers choosing to rent their properties rather than take a discount.

The Rise of the “Unmotivated Seller”

This is something I’m seeing more and more: people who list their homes just to test the waters. If it sells, great. If it doesn’t? No problem. They delist it and wait for better market conditions.

In fact, delisting are up 35% year-to-date and 47% year-over-year in some markets. That’s not panic—that’s patience.

The crash crowd keeps screaming “inventory surge,” but it’s not backed by true motivation. These are not distressed sellers. They’re optional sellers. And that’s a huge distinction.

Who Is Selling?

So who’s still motivated to sell in this market? Here’s what I’m seeing:

1. Flippers Who Overpaid

Bought in 2022 or 2023, started a rehab, and now can’t make the numbers work. Many are cutting losses.

2. Airbnb Investors

Those who bought at the peak and now face declining bookings or oversaturation. If they can’t pivot to long-term rental, they’re getting out.

3. New Builds and Developer Inventory

Builders are still sitting on supply they need to move. Especially if they used construction loans or rate buydowns that are about to expire.

4. Condos With Massive HOA Assessments

Florida is the canary in the coal mine here. After structural reform laws were passed, many older condos are being hit with $25K–$50K assessments per unit to bring buildings up to code. That’s crushing cash flow and forcing sales.

Why HOA Assessments Matter More Than You Think

Let’s talk about condos.

Many condo associations are severely underfunded. As inflation pushes up the cost of materials, labor, utilities, and repairs, associations are passing those costs onto owners via increased dues or special assessments.

In Florida, especially, new regulations require older buildings to undergo structural assessments—and the costs get passed directly to owners.

So if you’re buying a condo, always ask:

• What’s in the reserves?

• Are there upcoming assessments?

• Is the HOA collecting enough to cover ongoing maintenance?

This can make or break a deal.

Where to Focus Now: Property Distress, Not Market Distress

This is where savvy investors get ahead.

The market overall may be slow, but not every seller is calm and collected. Look for individual properties in distress—even in strong markets.

What Distress Looks Like:

• A stalled flip with no activity

• A vacant Airbnb bought at peak pricing

• A new construction project with 50% lease-up and a looming loan maturity

• A developer with hard money debt and no exit

• A condo owner hit with an unmanageable assessment

These situations create real opportunity, even when broader market conditions don’t scream “crash.”

Real Example: Buying at the Cost of Construction Debt

We recently made an offer on a partially leased property where the developer couldn’t secure permanent financing. They’re still stuck on the construction loan, burning cash. We offered to buy at the value of their debt—essentially wiping out their equity.

For us, it’s a win. We’re buying based on real numbers, not emotion. For them, it’s an exit. That’s what distressed deals look like today.

The Smart Strategy Now

Here’s what I recommend:

1. Look for motivated sellers, not just listed homes.
   Ask: “Why are they selling?” Divorce? Death? Debt?

2. Target recent buyers in 2022–2024.
   Many are in high-rate mortgages or short-term loans and are more likely to be under pressure.

3. Use your local knowledge.
   That half-finished house in your neighborhood? There’s a story behind it. Find it.

4. Watch for price drops.
   Multiple reductions in a short window = high motivation.

5. Fix your debt and ensure cash flow.
   Don’t speculate. Lock in rates and buy income-producing properties.

Final Thoughts: Patience Wins

This is not 2008. Most sellers don’t have to sell. But that doesn’t mean deals aren’t out there—you just have to dig deeper.

Watch for property-level distress. Be ready to act when someone needs a solution. And always remember: cash flow and fixed-rate debt are your best friends in any market.

The sellers are retreating. That’s your signal to step up.

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