Sun Belt Rentals Are Slipping Into Distress
Record vacancies and falling rents are hitting small landlords at the exact moment their DSCR loans stop penciling out.
The investors who binged on cheap leverage and assumed endless rent growth are now watching their margins evaporate month by month.
And once those loans start breaking, distressed asset investors will finally see the kind of motivated selling this cycle has been missing.
Top stories of the week
Click any headline to read the full story.
The Wannabe Real Estate Moguls Going Bust
Mom-and-pop landlords used “DSCR” loans which bypass personal income checks to focus on a property’s rental potential to binge-buy homes, betting that rising rents would cover the costs.
Apartment Rents Drop Further, with Vacancies at Record High
U.S. apartment vacancies hit a record 7.2% in November, a 5.2% drop from their 2022 peak. The plunge is driven by a historic flood of new units hitting the market just as demand weakens, with a record share of young adults now living with family instead of renting.
Biggest Real Estate Discounts of 2025
From a San Francisco office selling for 85% below its pre-pandemic peak to a Miami development site bought for half its 2023 price, 2025’s real estate market was defined by shocking, coast-to-coast discounts.
Home Prices are Poised to Dip in 22 U.S. Cities Next Year. See Where.
Home prices are forecast to fall in 22 major U.S. cities next year, led by pandemic boomtowns in Florida like Cape Coral, which could see a 10% drop. This dip, concentrated in the South and West, signals a cooling from the frantic pandemic pricing as inventory grows and demand normalizes.
Manhattan Condo Values Fell Over the Past Decade. Here’s Why Rents are Still Rising
Manhattan condo values have fallen over the past decade, with one in three now selling at a loss, yet median rents have surged 10% in the last year alone. This paradox is driven by high mortgage rates, which make buying prohibitively expensive, monthly costs for a median condo can exceed $8,000.
Mortgage Rates Are Not Too High. What’s too High Are Home Prices
The true affordability crisis stems from home prices that skyrocketed 40-70% in two years, not from today’s historically normal mortgage rates. The only real fix is for those inflated prices to fall, letting wages catch up, because artificially lower rates would just send prices soaring again.
10-Year & 30-Year Treasury Yields Jump, Wiping out in the Entire Drop of Last Week
Bond markets reversed course sharply Monday, with the 10-year Treasury yield and average mortgage rate each jumping about 8 basis points to wipe out all of last week’s declines. The move highlights how long-term yields are decoupling from the Fed’s rate cuts.
