How to Sell MY MN House Cash or Seller Financing offer | We buy Houses

Shift Happens


From motivated buyers to motivated sellers

We have gone from ‘the fear of missing out to just fear’ in the national housing market.  Some cities with a lot of speculation have seen very large inventory spikes.

The world is not like 2008 with poor underwriting, a subprime crisis and many ARM loans.

That small segment improved since 2008.  In some ways today it’s a far far bigger problem as the global debt is now over $300 trillion in debt where much of it is tied to interest rates that have recently doubled while the fed funds rate is set to go up another 2% by the end of the year.

Will we see owner occupied interest rates over 8% by the end of 2022?  How high will non owner occupied interest rates get?

Owner occupied interest rates are currently near 6.4%+ at the time of this writing, with some general google searches showing about 7%

We now are in a unique housing market,  where as we talk to motivated sellers, the question of the interest rate on the underlying financing will be more important than the condition of the house.

A house that you can take over payments on, subject to existing financing, at only a 2.7% interest rate that’s in poor rental condition is far superior than a turnkey retail single family home available to purchase at an 8%+ interest rate.

The value is now in the paper

Unlike 2008, we are starting to experience deflation and inflation at the exact same time

The cheap money expansion for over 10 years of declining rates for both businesses and homeowner’s lifestyle has come to a screeching halt and they can’t escape and exit with a future cheaper payment.

Many landlords want to keep raising rents to adjust for inflation, but wage growth simply isn’t keeping up.

The very interesting game of chicken that we are seeing in the housing market right now, is that due to the uncertainty of wild inflation on food, energy, utilities, gas, cars and car repairs, people want a fixed cost and certainty on their housing payment to be able to sleep at night.

This is from a recent article on fortune



September 9, 2022

“Consider that 85% of outstanding mortgages are locked in at sub-5% rates, with 24% sitting at seductively low sub-3% levels. Good luck persuading someone to relinquish their sub-3% or even 4% fixed-rate mortgage when inflation is at a 40-year high and the cost of everything is wildly volatile.

In fact, according to a recent survey from the New Home Trends Institute, 64% of existing homeowners with a mortgage won’t purchase again if the mortgage rate exceeds 5%. The percentage of existing homeowners unwilling to purchase again at 6%+ mortgage rate jumps to 85%. Existing homeowners account for 51% of all home purchases and overwhelmingly require a mortgage according to the National Association of Realtors”

The idea is that homeowners aren’t motivated to sell their house with a low fixed payment because it’s a great protection on rising inflation.  What will the 33-40% of homeowners who own free and clear do?

Of course as investors, we know shift happens in life from death, divorce and default.

Eventually sellers need to sell, and don’t want to hassle with listing their house and want to either sell cheap for cash to one of the few cash buyers, or sell with seller financing to an investor like yourself.

Sellers will through subject to, rent to own (lease option), or contract for deed, and some homeowners will become accidental landlords and just rent out their houses, even the $1 million homes.

What will be the motivation for even a non motivated seller to sell with seller financing?

They won’t want to drop their price $50,000, $100,000, or $200,000 just because the new house buyers demand it because otherwise they can’t qualify for bank financing at over 8% high interest rates.

The cash buyers know they’ll have to wait years for housing to recover, and doing a cash out refi, or selling for retail will take too many days on the market, so they’ll reserve their cash for extremely great house discounts.

For the market to feel broken you don’t only have to have supply of listings shoot way up, you can have buyer demand (demand destruction) go way down, which it is already and will accelerate at 8% intetest rates as the buyers wages and debt-to-income ratios can’t possible keep up with higher home prices.

Homeowners are also losing a good option on motivating factors like layoffs by pulling out cash on cash-out refinances with tighter lending standards, lower LTV (Loan to Value) and eventually cut appraisal on prices by banks underwriting, and comps getting disqualified from the lenders.

A high interest rate environment makes it very difficult for most companies to remain profitable, so you should see layoffs and unemployment rise, but by how much and exactly when is hard to say, but many have started along with huge companies with hiring freezes.

For those who want to avoid the asset bubble deflation by going back to 4% interest rates, although it may eventually have to happen, the amount of money printing by the fed to suppress rates this low again will make inflation far worse and the debasing of the US dollar will cause a compounding of rising expenses on supply and labor to manage rental properties.

Think inflation + deflation this time vs. 2008.  You don’t need to see a 50% crash like last time, think 25% crash and sustained true 15-20% inflation for a long period of time, even years.

So adjusted for inflation you’d feel similar effects to 2008, or possible worse. This will be a huge global debt liquidity crisis and even China and other countries real estate crashes will effect the local market in the USA.

Investors like yourself will get ready to find motivated sellers with different options this time and watch as the credit contraction unwinds as the complete opposite of what happened since money printing and easy credit since after 2008.

With a looming retirement crisis on the horizon, we are all in this together.

The older motivated seller generation will feel dependent and be very concerned that they will outlive their savings with the spend down of their falling equity and the US dollar eroding through accelerating inflation.  With aging and retirement, Sellers can’t afford enough time in their remaining life to wait for the market cycle to rebound.

The younger generation of investors with decades to go to prepare before retirement are overwhelmed with needing $5 to $10 million, or more in retirement, due to the cost of living, so those real estate investor buyers are looking for the opportunity to score big on cash flow and instant equity with the upcoming housing crash.

Last time in 2008 we lost half of the mortgage people and real estate agents as houses sat on the market for months with no demand, so this will change the market dynamics vs. today.

The good news for myself and you the reader, is as an investor that sees the market shift to pro investor, we will have so many options that we will simply pass on deals, such as, a 5.5% ‘subject to’ deals in marginal neighborhoods needing some fixup, simply because we have far too many 3%+ subject to deals to look at in hot neighborhoods, already in amazing condition.

The crashing economy is a trigger for many, but for others like yourself it’s a tremendous opportunity for those that desire a bright future in real estate investing.

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