Why It’s So Hard to Find a Good Deal in Real Estate

Quick Summary:

• Most listings don’t meet investor return goals

• Sellers are still chasing 2020–2022 prices

• You have to screen 50–100 properties just to find one that works

• Even “deals” come dressed up and overpriced

• High rates, insurance hikes, and repair costs squeeze margins further

• Off-market is better—but also way harder

• The whole system is tilted against investor logic

This Is Supposed to Be Hard

If you’re trying to buy a rental and feeling frustrated, you’re not alone. I talk to people all the time who say:

“I ran the numbers—it looked like a 6% cap rate online… but when I did the math, it was more like 3.5%. Nothing pencils. Is it just me?”

It’s not just you. It’s the market.Finding a good deal is genuinely difficult—and here’s why.

1. Most Listings Aren’t Priced for Investors

The average MLS deal isn’t priced around performance—it’s priced around seller expectations.

Sellers (and their agents) post a “cap rate” that assumes:

• Perfect rent collection

• No vacancies

• Unrealistically low expenses

• Aggressive rent growth

I’ve seen listings advertised at 6% that come out to 3.8% once I factor in vacancy and realistic costs. That’s not a bad calculator. That’s the truth.

2. High Interest Rates Kill the Math

Even if a property almost makes sense, today’s financing can push it over the edge.

Investor loans are hovering between 6–8%, which drastically increases your monthly debt service. That compressed spread often means the numbers don’t work—unless you negotiate a steep discount or bring a huge down payment.

You’re not just buying the building—you’re buying the debt attached to it. And that debt is far more expensive than it was just a few years ago.

3. Sellers Are Still Living in 2021

Most of the sellers I see right now bought at or near the top of the market—or traded into something that cost even more.

Now, they’re trying to recoup:

• The original purchase price

• The agent fees (6%)

• Excise tax

• Renovation costs

• Plus a little “profit”

They’re not pricing based on investor returns—they’re anchoring to past highs and trying to recoup sunk costs.

And they’ll hold onto that number until reality—or time—breaks them down.

4. Buyer and Seller Expectations Don’t Match

Here’s the core tension:

• Sellers still think their property is the crown jewel

• Buyers are doing math. Sellers, more often than not, are still pricing emotionally.

• In many metros, there are hundreds of thousands more listings than buyers

That mismatch causes a kind of standoff.Sellers sit. Buyers pass. Nothing moves. And prices don’t fall as fast as they should—yet.

It’s a waiting game—and in the meantime, it’s chaos for anyone trying to find something that actually pencils.

Why This Feels So Confusing

If you’re new to real estate, this all feels backwards. You’re doing the work. You’re running the numbers. And nothing makes sense.

That’s not because you’re missing something—it’s because most of what’s available isn’t priced for logic. It’s priced for emotion, legacy, or loss avoidance.

The math only starts working once sellers stop pretending they’re still in 2021.

Even when the deal looks close to working, today’s lending environment can tip it over the edge. Lenders are tightening up across the board—higher DSCRs, lower LTVs, and bigger reserve requirements mean borderline deals no longer qualify.

5. You Have to Screen a Lot of Properties

Early on, I’d look at 5 or 6 properties, run the numbers, and feel defeated.Now? I know that finding one good deal often means analyzing 100+ properties.

Even today, I look at dozens of multifamily listings per week—and maybe one or two are worth deeper attention.

This isn’t HGTV. It’s a filtering exercise. You don’t win by finding a gem—you win by being willing to look longer than most people will.

When I do find something that hits a 6–7% cap rate after conservative assumptions—vacancy, expenses, realistic rent comps—that’s when I dig deeper. But those are rare.

6. The Type of Property Matters—And Most Are a Bad Fit

Certain asset types make finding a deal even harder:

• Condos: Crushed by HOA fees and rental restrictions

• SFRs: Competing with homeowners willing to pay way more

• New builds: Almost always priced for perfection

I’ve lived in a condo. I hated it. And I’d never invest in one.The politics, the overhead, and the “no renters allowed” vibes are just exhausting. It’s not worth the squeeze.

On the flip side, small multifamily properties like duplexes or triplexes often attract fewer emotional buyers—and more investors who think like you. Less competition from owner-occupants means pricing is more likely to reflect returns, not feelings.

7. Every Listing Gets Dressed Up

Before a property hits the market, the agent helps “optimize” it:

• Rents get bumped to look more impressive

• Units get patched or staged

• Cap rate is calculated with fuzzy numbers

It’s the most expensive version of that property you’ll ever see.

Even if it looks okay on paper, you’re still buying the version with:

• Realtor fees built in

• Excise taxes factored in

• Full polish included

You're not just buying the property—you’re buying the performance.And when you buy a polished MLS deal, you're covering the seller’s entire optimization strategy. Convenience has a cost—and it shows up in your returns.

8. Higher Costs, Lower Returns

It’s not just financing. It’s everything else too.

Insurance premiums have quietly doubled in many markets—especially in states facing climate risk or insurer pullouts. What used to be a $1,200 policy might now cost $3,000. And that’s if you can even find a provider.

Maintenance and repair costs haven’t let up either. Materials are still expensive, and labor is in short supply. Whether it's HVAC, plumbing, roofing, or basic turnover work—expenses are far higher than they were when many pro formas were written.

Those quiet cost increases can turn a “decent” deal into a losing one fast.

9. Off-Market Deals Are Better… But Rare and Hard

Yes, off-market deals tend to have better math.But finding them is another story.

You don’t get a database of leads. You get:

• Cold calls that go nowhere

• Sellers who aren’t actually ready

• People who ghost you halfway through

I’ve tried dozens of times. Only one off-market deal has worked for me. It was great—but I earned every bit of it.

MLS is convenient—but you’ll pay for that convenience.Off-market deals take more work, but can offer stronger returns if you're persistent.

The MLS is the showroom. Off-market is the back room—the messy, unlisted inventory where value hides if you’re willing to dig.

10. Time Is the Only Real Filter

A lot of the best deals I’ve done started as bad ones.

There’s one I watched drop from $800K to low $600s over the course of two years.Every few months, I’d check in. No pressure, just, “Still here if it makes sense.”

Eventually, it did.

Sellers don’t always adjust quickly.But if the property sits long enough—and your math stays the same—you’ll eventually meet in the middle.

And remember: many of them are sitting on 3–4% mortgage rates. They’re in no hurry to sell—which is part of why inventory stays tight, and prices stay sticky.

Final Thought

If finding a deal feels impossible, it’s because the deck is stacked.

Most listings are overpriced.Most sellers are unrealistic.Most of what’s available doesn’t work for investors.

And yet—if you stay patient, disciplined, and relentless with your math…

You’ll find the deal that does.

Sometimes getting a deal means adjusting your expectations—whether that’s accepting a lower return in exchange for less risk, or shifting your focus to less conventional properties.

If it feels like it shouldn’t be this hard, that’s because most people aren’t willing to go this far.

If it were easy, everyone would be doing it.