Finding Discounted Real Estate Just Got Easier

0:00Do you want to know which markets offer the steepest discounts and the best deals for investors in 2026? Of course you do. And a great place to start that research is to try and identify where there are motivated sellers who are willing to negotiate and meet your price and terms. But knowing which markets and asset classes have the most motivated sellers is hard. That is until now. Just this week, I uncovered a brand new motivated sellers index that pinpoints which markets have the most motivated sellers, what asset classes you should target, and it even tells you what discounts you should expect to build your offer around.

0:43It is a absolute treasure chest of data for real estate investors looking to take advantage of the buyer's market we're in. And today on On The Market, we're digging in.

0:58Hey everyone, welcome to On The Market. I'm Dave Meyer. Today we have a very fun episode because we have brand new data and information about the housing market that I have never seen before. A company called Parcel Labs, it's a real estate data company. They've developed a motivated sellers index. And over the last couple of days, I have been having a field day with this information, having a lot of fun incorporating this into my own strategy. And I wanted to share it with all of you because it's really, really valuable. So today on the show, we're going to talk about why you should care about motivated sellers in the first place.

1:39We'll go through that quickly. and then we'll get into the index and understand where there are motivated sellers and how you can best use this brand new information to your advantage. So let's just start and talk about what a motivated seller is. You probably have heard this term before, but if not, it's exactly what it sounds like. It's someone who lists their home for sale and is very eager to get rid of that property. They're not sitting around waiting for the perfect offer or the perfect terms or the perfect price or anything like that, they were typically willing to work with the buyer to get something sold relatively quickly.

2:16And as a real estate investor, you can probably see that this is a very advantageous position to be in. If you work with a motivated seller, you have a lot more negotiating leverage to get your terms and your price. Now, motivated sellers come from all sorts of situations. You often see them come from sort of the unfortunate situations that arise, like from probate or divorce. But you see these just with regular people too. Someone gets a new job, they have to move across the country in two weeks. Whatever it is, they're motivated to get rid of the house. Now, I would forgive you and understand if you've never had the great chance of working with a motivated seller because during COVID, there weren't many of them.

2:57Or maybe they were motivated, but there was just so many buyers that they can still get their price anyway. But right now, I think just the way market dynamics are working is we have more motivated sellers. I've talked about it at length on the show. It's not really from delinquencies and foreclosures. That's up from the last couple of years. But from a historical perspective, it's not crazy. We're just getting back to a regular level of motivated sellers where there are people who want to get rid of homes. And since we're in a buyer's market and days on market are going up and things are sitting on the market longer, people are getting a little bit itchier.

3:33Unless you can afford to be patient and have nothing to sell for, there are more and more motivated sellers in the market. And this comes with discounts. It comes with concessions. It comes with better terms. So knowing where to find motivated sellers is super, super valuable. And that's why we're going to identify key markets and trends that can help you pick markets, can shape your offers and help you land incredible deals. So for that, we're going to turn to this Motivated Seller's Index. It's super cool. We will put a link to it in the show notes. Of course, you can check it out at Parcel Labs as well.

4:10But I'm just going to talk through how this Motivated Seller's Index, I'm going to just call it the MSI, is created and what you can do with it. So the way Parcel Labs is doing is they measure three different things to determine if sellers in a given market are motivated or not. Those three things are days on market, price cut frequency, and price cut magnitude. So days on market is something we talk about all the time, but it's just how long has something been sitting on the market because time creates pressure and a listing that has aged past the local norms. You know, people see their carrying costs go up.

4:49They start to worry that their listing has gone stale. They maybe see a little less foot traffic when they do an open house. There are less showings. That increases pressure. People get a little bit nervous. Maybe they get a little more motivated. The second thing is price cut frequency. So how often are they cutting? This is something that is super valuable. Anecdotally, I've done this in the past, but if you see someone cutting one weekend and then the next weekend and then a third weekend, that person is pretty motivated, right? So that's the second thing that's measured there. The third thing is price cut magnitude.

5:25So how deep are those cuts? Because some people maybe just cut 1 % to get it to the price drops filter on Zillow or Redfin or whatever. But if you're dropping 10%, right, like that shows a little bit of desperation. I should say motivation, maybe desperation, we don't know. But when you combine these things, right, this makes sense to formulate the Motivated Seller's Index. We got days on market, price cut frequency, and price cut magnitude. And by combining these three things into just a single number, you can actually evaluate which markets are the most motivated, which markets are the least motivated.

6:08And even if you're not shopping markets right now, this information can really help you formulate your offer. Because if you're, you know, you might be investing in your backyard And if things are really motivated, if people are just fire selling deals, like that's going to change what you should offer. You should try and extract as many concessions as possible. And some of the episodes we've been talking about how effective asking for concessions are like you can formulate your strategy around that. If you're in a neutral market, you can't do that. They're going to ignore your offer. So this information really matters to all investors.

6:40And it's very difficult, at least in my experience, it has been very difficult to look at days on market and price cut frequency and depth on your own and try and say, like, what is going on here? That's a lot of information to aggregate yourself. Like, you can't do it. I mean, you could if you had a data feed, but it's difficult. So like having this one number really does help. And the way they've done it, Parcel Labs has done it, is they've basically made it a 1 to 10 score with 1 being low, like neutral. People aren't really motivated. 10 being the highest. And they actually break it down into four different buckets.

7:20And if you're watching this on YouTube, I'm actually just going to pull this up right now. I'm going to just show you this. You can see the URL. You can go look at this yourself, too. But basically, between 0 and 2.5 is neutral. between 2.5 and 5 is stubborn. So people aren't really trying to sell, but they'll do it a little bit. Between 5 and 7.5 is motivated. And then between 7.5 and 10 is fire selling. So those are the most motivated markets in the country if you're between 7.5 and 10. And if you look at the national housing market right now, the whole United States, It's slightly motivated.

8:00Five is the line between stubborn and motivated. And on a national basis, we're at 5.1. So a little bit motivated. It's been trending up a little bit, but not that much. But of course, this national average really hides the information that real estate investors want to know. We want to know what's happening in my market, what is happening in my asset class. And we're going to get into that right after this quick break. Stick with us. Summer bookings sound great until someone slips by the pool, gets hurt on your dock, or damages your property during a long holiday weekend. A lot of short-term rental investors don't realize their standard policy may leave gaps when it comes to short-term rental activity.

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11:16Welcome back to On the Market. I'm Dave Meyer. Today, we're going over a new motivated seller index that I found from Parcel Labs. Before the break, I broke down the index itself. It's from zero to 10 and told you that in the United States, on a national basis, it's at 5.1. But let's look at what's happening regionally. Now, again, And if you're watching on YouTube, I'll actually just scroll down and show you some of this and how this is ranked. But right now, the number one most motivated market in the country is Sherman, Texas, where we're at a seven. So it's really important if you go back and look at their categorization, anything above a seven and a half is fire selling.

12:02And so there's really no markets in the country that are at fire sale status. And this sort of jives with what I've seen, at least anecdotally in the market. Tell me in the comments if you're wrong, but I'm not seeing fire sales. I'm seeing big discounts as an investor, which is great. But I'm not seeing, you know, people paying 70 cents on the dollar for things, at least on market deals. Right. You don't see that. And I think that's good. Right. Like as investors, we do want discounts like a buyer's market is to the advantage of anyone who's trying to acquire and to build, but you don't want fire sales.

12:38Like the risk of catching a falling knife is higher in those situations. So Sherman, Texas is number one. Tampa, Florida is number two, also at seven. Punta Gorda at 6.9. Austin and 6.9. San Antonio at 6.9. So those are the high end. You'll also notice here, it's kind of cool. They have a breakdown between single families and condos. I don't think a ton of investors invest in condos. I personally don't, But it actually breaks it down. So like in Sherman, Texas, for example, single family index is a little bit higher. It's 7.2. But for a condo, it's lower 6.4. That's weird. I would have thought condos were higher.

13:16But right now, people are holding on to their condos a little bit more, except in San Antonio. In San Antonio, you have a 7.3 % for condo and single family. So hopefully you're already seeing how useful this can be in your market. But let's just talk about sort of the other end of the spectrum, the least motivated markets. So we have Rochester, New York. Crazy. I'm just still shocked at how strong Rochester was. I went to college there and the market was awful. But it's been so strong for like five years straight. Their motivated sellers index is at 1.7. So don't try and negotiate if you're going to Rochester, New York right now, because people are not motivated.

13:56That's a good, strong seller's market still. Lincoln, Nebraska at 2.3%. Hartford, Connecticut, we've talked about that market a lot so far this year at 2.5%. Syracuse at 2.5%, another Western New York. And then Atlantic City is also at 2.5%. So those are the total opposite end of the spectrum there. And again, we'll put the link to this. So you can look this up. I'm just gonna pick a market, Denver. I'm about to list a property for sale in Denver, and I am motivated. I'll just tell you right now, I'm not expecting to get the best price on that one. So let's just see what's going on in Denver. Denver right now, motivated.

14:376.4 and it's climbing. It's actually down from where it was a year ago, but it's been going up. And this sort of jives with my own motivation. Like I just think about, I'm putting this property for sale. I sold a very similar home, almost exactly the same two blocks away in 2022. and I got an amazing offer on that, and I was pretty firm on my terms. I did not really give up much in terms of an inspection objection. I'm selling this property. I'm gonna be willing to work with a seller if I can get something, a buyer, I mean, if I can get something under contract. So this sort of jives with my situation.

15:13I'm selling a single family, 6.7. I'm not gonna sell it if I can't get a decent price, but like I'm willing to give up a little price to get rid of this property. So you should definitely go check this out, right? Like if you are curious about how your market is performing, or if you are looking for a market to invest in, check this out. The URL is too long, so I'm not going to read it. Just click on the link in the show notes or in YouTube, we'll put it in the description so you can check it out there. But go look at your market. This is super, super valuable. And we're going to talk more in a minute about how you can actually take action with this because the data is interesting on its own.

15:50But there are deliberate things that you can be doing with your portfolio with this information. And we're going to talk about that in a second. But I first just want to talk about institutional sellers for just a second. Because like I said, no market in total is fire sale status right now. But there are definitely individuals who are at fire sale status, right? Like that's the best situation for you to find if you can get a good discount. but Parcel, I was like digging through their data and they've been tracking institutional single family portfolios. And in some of these markets, these sellers are like dumping a lot of listings, like potentially dozens or hundreds.

16:35And so if you could find things like that, to me, that just seems like a dream scenario. Like they're probably good assets. Like most of these institutional buyers don't buy really old things. or if they have, they've probably fixed them up. So they're probably in decent shape, don't need a ton of capex and repairs. And they're probably very motivated. Just think about the logistics to sell tons and tons of deals, potentially hundreds at a time. And these are in good markets. They're in Dallas and Houston and Atlanta and Tampa. And if you're wondering why they're dumping them, these businesses work differently.

17:11They might be willing to sell and they're gonna re-up in a different market. They might be huge hedge funds and they want to allocate some money out of real estate. Maybe they're not able to operate efficiently at the scale that they are at, but a small landlord who's self-managing might be able to make this into a great deal. And so it's hard to find these things, but talk to your agent and see if you can find these things. There's an example. There's a company called First Key Homes. They have literally hundreds of active listings and they are seeing the average cut running 20 % off original asking price, right?

17:49And they're cutting every 20 days. So if you can find something like that where these institutional sellers are trying to just get rid of deals, super interesting opportunity if you can find them. So talk to your agent, especially if you're in one of these markets that are really hot, like, or were hot, like a couple of years ago, Phoenix, Atlanta, Dallas, San Antonio, you know, the Southeast, like these places, you might be able to find something. And this is kind of like what we've been talking about previously on the show about new construction. We've talked about how new construction, most builders, they're motivated sellers right now.

18:27New construction, they want to get rid of that inventory. Similar to institutional investors, their business model does not allow them to be patient and to sit around and wait for deals to sell at the perfect price. So think about taking advantage of that business model and being a solution to them because you can operate these deals better than they can. So that is one thing you can do in your own portfolio with this information. But I want to just talk a little bit more about once you've identified a market or you look at this information for your market, what you should do about it. We got to take a quick break, though.

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22:39Welcome back to On the Market. I'm Dave Meyer. Today, we're talking about the Motivated Seller's Index, and I want to talk a little bit about how to use this information. So first up, I think the obvious thing here is using this to pick a market. Now, not everyone is looking for new markets all the time. If you're new, maybe. But if you are looking for a market, this is pretty good information. I think as someone who invests in multiple markets, invests out of state, that this is kind of gold. Because the way I think about it and the thing I would do if I were you, is to combine data about fundamentals of the market with this information.

23:16Because if you can find a market that has motivated sellers, but has really good long-term fundamentals, that's really valuable. Think about Austin or Nashville, right? They're struggling right now. Good markets. We don't know when they're going to recover. But if you can buy 10 or 15 or 20 % below current asking price and comps, that gives you a lot of cushion, right? You are walking into equity, even if the price goes down another 5%, which most markets are flat, like they're not even going down that much. So that is like an amazing thing that you can do is just like go out and use this for market selection.

23:53The second thing that you can do is actually use this to identify specific properties. Now, full disclosure, this is a paid feature of Parcel. And I just want to say Parcel, they are not paying for this. This is not an advertisement. They did give me an account to check this out. They did not ask me to make this video. I am just making this video because I found it really interesting. I just met them and they sent me all this data. I was like, wow, this is really cool. So this is a paid thing. But again, I am not being paid to say this. I am just choosing to say this because I think it's really cool.