Real Estate Observer This newsletter will provide frameworks & analysis you can use to confidently invest your capital in private market real estate. It is written from the perspective of someone who reviews many deals in search of one that fits my personal or my investor community’s preferences. To keep up with what I’m working on, click here. |
One thing many investors overlook is that sellers aren't always easy to work with, and their motivations can vary significantly depending on their circumstances. We’ve even seen sellers commit outright fraudulent acts in an effort to get the best price possible.
Key motivations for sellers include:
Price
Privacy concerns
Timing requirements
Ongoing operations
Partnership disputes
Operational burnout or strategic pivots
Tax considerations
A Recent Example
Earlier this year, we evaluated an asset in the NC Triangle area that we were genuinely excited about. Our operating partner, who has an excellent track record, informed us they had the property under contract and were entering due diligence. We immediately began our own process. This included touring the asset, quite a few meetings with our operating partner, and a series of emails to really understand the business plan and how we (and our investors) were going to make money on this deal.
After developing confidence in the risk profile, we were prepared to move forward.
Then, the delays began.
During a call with the buyer (our operating partner), we learned the seller was reluctant to ask for income verification from tenants who had moved in more than a year ago. This information was critical to our underwriting and business plan for various reasons.
The seller's reasoning? They feared ruffling feathers with the tenants by verifying income, particularly if the deal fell through and they had to manage the "fallout." This seemed like a lame excuse as requesting a pay stub is hardly invasive. Regardless, we were at an impasse. We weren’t going to move forward on the deal without this information.
Ultimately, the seller's desire to avoid tenant friction outweighed their motivation to close quickly. They opted to list the property with a brokerage instead, and it actually hit the market this month (January 2026).
Fortunately for us, the seller is now approaching their loan maturity. They must sell or refinance and their refinance opportunities aren’t great for various reasons. This added pressure should shift their priorities, making their motivation to sell outweigh their reluctance to request tenant income verification.
We’ll see if the deal comes back around….
One thing I always try to understand as an investor is why someone is selling. In this particular instance we knew their loan maturity was coming up, but it was too far away to push the seller to act last year. Now that we are a few months away from their maturity, the entire deal could shift in our favor.
If you’re interested in North Carolina single-family development or existing multifamily opportunities, you can follow along by clicking here. I usually only come across 1–3 deals per year that are truly worth investing in.
Clay Stanley
704-608-8488
