The real estate landscape today carries echoes of prior downturns but behaves distinctly. High-profile operators are spotting large price reductions—some properties are being offered at as much as 80% off peak prices—and veteran investors describe the scene as the kind of opportunity that appears when capital and time align. This piece synthesizes observations from Ken McElroy, an operator with roughly 10,000 rental units, and Daniel McElroy, who focuses on single-family rentals, to explain where discounts are concentrated and why patient, prepared buyers can act now.
Ken and Daniel come from different lanes of the market: Ken’s experience sits firmly in multifamily—acquisition, development, and value-add operational work—while Daniel concentrates on single-family investments and client deals. Together they highlight practical moves for investors entering a market where financing stress, maturing loans, and changing occupancy patterns create a gradual price adjustment. Their perspective centers on a slow unwinding of risk across the capital stack rather than a sudden, uniform crash.
Table of Contents:
How this cycle diverges from 2008
There are superficial similarities to previous cycles—prices falling and opportunistic sellers—but the underlying dynamics differ. In 2008 the shock was a broad single-family collapse that pushed many households into rentals, creating a flow of demand that bolstered multifamily investors. Today, the supply picture looks different: years of reduced homebuilding created an ongoing shortage, and the present tension stems more from rising interest rates and loan maturities than from mass homeowner distress. Put simply, rates are resetting values while structural undersupply keeps a floor under long-term rental demand. Investors should treat this as a credit-driven repricing rather than a repeat of the earlier inventory glut.
The mechanics of the slow unwind
Price discovery now often follows the health of the capital stack. Many ownership groups are structured with a general partner and a limited partner, and when cash calls, covenant breaches, or loan maturities arrive, the weakest sponsors are exposed first. Lenders may tolerate interim fixes, but when a note is underwater relative to collateral values they can repossess and market the asset at loan value. This produces a staggered flow of offerings rather than an immediate flood. The practical result: discounted assets appear in tranches as operational and financing pressure reveals underperformance, poor cost controls, or simple timing mismatches.
Where bargains are showing up and why single-family looks different
Ken reports seeing steep discounts in the multifamily sector and says that seasoned buyers who maintain dry powder and underwriting discipline are in a position to act. Private credit and alternative financing channels are also becoming more prominent as banks reprice risk. Meanwhile Daniel emphasizes that single-family homeowners often remain locked into historically low mortgage rates, which suppresses forced selling. Distress in single-family markets tends to be localized: overleveraged flippers, owners who misjudged short-term rental markets like Airbnb, or borrowers in hard-money positions who face cashflow shortfalls. Those niche pockets can produce excellent opportunities for buyers willing to negotiate.
Examples and practical buy-box guidance
Practical strategies blend price discipline with operational clarity. Daniel offers a straightforward example: he recently bought a four-bedroom house near Phoenix for roughly $500,000 and leased it for about $2,900 per month. Even if the asset’s paper value is slightly down from purchase, accumulated rental income—he cites collecting over $100,000 in rent across a multi-year holding—offsets short-term valuation noise. Ken advises focusing on markets and neighborhoods with resilient employment bases, controlled capex plans, and properties where improving operations will unlock value quickly.
Actionable advice for investors right now
Success in this environment requires preparation: have financing alternatives, stress-test deals against higher debt costs, and identify sellers who are compelled to transact rather than those simply waiting for a perfect market. Emphasize hands-on operational capability because the first tranche of distress tends to be managerial—poor expense control or overlooked maintenance drives underperformance. For buyers who want to scale, Ken and Daniel recommend building a clear buy box, sourcing sellers with immediate needs, and employing conservative underwriting that treats today’s rates as a baseline. In short, don’t wait for an exact bottom—negotiate and execute where fundamentals and price alignment meet.
