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- New: đź§ Market Minds Issue #090
New: đź§ Market Minds Issue #090
We appreciate each and every one of you for taking the time to read Market Minds. Buckle up and enjoy the free value, and you won’t want to miss the TERRIBLE financials of one particular flip.
America’s Real Estate Market Splits in Two

Source: HousingWire
Bold Numbers, Bigger Questions
The Trump administration is reportedly eyeing a late-2025 IPO of Fannie and Freddie, targeting up to $30 billion in proceeds by selling 5–15% of their stock. The combined valuation? North of $500 billion by some estimates. That’s not chump change — that’s the GDP of Belgium being floated on the market. But the key question is whether they remain under federal conservatorship, a leash that’s been on since the 2008 housing crisis.
The Signal Behind the Sale
It says the administration believes the housing finance system is stable enough to partially privatize its crown jewels. The fact that Trump personally convened Jamie Dimon, David Solomon, and Brian Moynihan last month to talk strategy shows they’re not treating this as routine. If the IPO prices strong, it could be read as a vote of confidence in mortgage demand, underwriting quality, and the broader economy heading into an election year.
Mortgage Market Shockwaves
Fannie and Freddie touch roughly half of all U.S. mortgages. Any shift in their governance or capital structure could ripple through loan pricing, credit availability, and risk appetite across lenders. A successful IPO could nudge rates and spreads as private shareholders start pushing for profitability over policy mandates. Translation: the calculus on affordability could change, even subtly, in ways that matter at the offer table.
Timing and Momentum
Second-quarter earnings show both GSEs are flush — $3.3 billion in profit for Fannie, $2.4 billion for Freddie — giving the IPO a narrative tailwind. But remember: “doing well” today doesn’t immunize them from political meddling tomorrow. Investors will price in that risk, and so should anyone whose livelihood is tied to mortgage liquidity.
When the Market Starts Bidding for You

Source: Business Insider
Prices Break Formation in Key Markets
Late July brought a notable shift: home prices in 14 of the 50 largest U.S. metros fell year-over-year, with Oakland down 6.8% and West Palm Beach, Jacksonville, Austin, and Houston posting 2–5% declines. Nationally, prices are still slightly higher than last year, but the pace has slowed dramatically from late 2024’s 5–6% gains. Redfin now projects a 1% national price drop by year-end — the first annual decline since before the pandemic frenzy.
Demand Retreats, Leverage Returns
High mortgage rates have sidelined swaths of buyers, creating pockets where supply now outweighs demand. Homes are lingering longer, and sellers — especially those who need to move — are sweetening the deal. Concessions hit a near-record 44.4% of sales in early 2025. That’s not just small repairs; we’re talking $10,000 mortgage rate buydowns, $30,000–$40,000 price cuts from builders, and generous closing cost coverage.
Builders Blinking First
The most aggressive discounts are showing up in new construction, where developers face carrying costs and quarterly targets. Some are accelerating build timelines and lopping tens of thousands off the sticker before a buyer even counters.
The Window That Isn’t Wide Open
Buyer leverage is better than it’s been in years, but inventory remains a paradox: more for sale in some metros, still tight nationally. Many would-be sellers simply pull their listings rather than accept lower prices. That selective retreat is preventing a flood of inventory, which means opportunities are real — but they’re not everywhere, and they won’t last forever if rates ease and sidelined demand returns.
The Real Money Is in Staying Power

Source: NAR
Income Climbs, But Not for Everyone
The latest NAR Member Profile shows median Realtor income rising to $58,100 in 2024 — a 4% gain despite flat transaction counts and sales volume. But the market rewarded tenure, not titles. Agents with 16+ years in the business cleared $78,900, while those with two years or less scraped by at $8,100. More than six in ten new agents made under $10,000, a stark reminder that in real estate, the early years are survival mode.
Relationships Are the Revenue Engine
Production didn’t move, but the source of business did. Repeat clients (20%) and referrals (21%) now account for over 40% of the average Realtor’s deals, and for seasoned agents, those numbers dominate — with 40% saying more than half their business comes from returning clients. This shift matters: a mature, relationship-fed pipeline not only costs less to maintain, it’s more resistant to market slowdowns.
Efficiency Is Quietly Padding Margins
Median expenses dipped to $8,010 from $8,450 the year prior. Vehicle costs still led the list, but agents are trimming elsewhere — even website upkeep averaged just $60. For high earners, the discipline is consistent: control costs, keep operational fat low, and reinvest selectively where it drives client retention.
Flip Gone Wrong?
This Palm Springs, CA home is a perfect example of what COULD go wrong during a flip…
Check it out (specifically the pricing history) 👇
TL;DR (Too Long; Didn’t Read)
Fannie Mae and Freddie Mac are heading toward a late-2025 IPO that could raise up to $30 billion, signaling confidence in the stability of U.S. housing finance — but also introducing potential shifts in loan pricing and credit availability as private shareholders push for profits. Meanwhile, housing markets are diverging: 14 of the 50 largest metros saw year-over-year price drops, concessions are near record highs, and builders are cutting deep to keep sales moving, though inventory constraints in many areas limit how far prices can fall. For agents, the latest NAR data shows median income up 4% to $58,100, but the gap between veterans and newcomers is stark, with over 60% of new agents earning less than $10,000. Across the board, relationships and repeat business are proving to be the most reliable growth engine, while disciplined expense management quietly boosts margins.
Have a great weekend - we’ll see you next Saturday.
Cheers 🍻
-Market Minds Team