Part 2 of 2. They cut a deal for the developer. They’ll cushion the bank. But the couple who did everything right and bought the unit? Nobody is dialing their number.
Last piece I told you everybody grabbed the blame thrower and aimed it at the developer. I made the case that the price tag has a dozen fingerprints and only one name on it.
I stand by every word.
But I slept on it, and something kept gnawing at me. Because this deal didn’t just point the finger in the wrong direction.
This deal went too far in one place… and nowhere near far enough in another.
Let me tell you about Unit 1402.
The buyer everyone forgot
Picture a couple. Call them anything you want. They bought a presale in 2022, when the market was screaming and the lineups were real.
They did everything we tell people to do. Saved the deposit. Stretched to qualify. Trusted that buying beat renting. Signed the papers and waited two years for the keys.
The unit completes. And now? Their two-bedroom is worth less than they owe on it. They’re underwater. If they try to sell, they can’t get back what they paid. If they hold, they’re carrying an asset that could take years to climb back to even.
They didn’t speculate. They didn’t flip. They didn’t price a tower wrong. They just bought a home at the wrong moment in a market the government helped overheat.
Now read the rescue again.
The deal negotiates a price for the developer’s unsold inventory. It quietly takes pressure off the banks holding the bad paper. It clears the overhang off the books of the people closest to the deal.
There is no financing mechanism for the family in 1402.
No buyback. No cushion. No phone call. They get to eat it. Alone.
Bailouts roll uphill
Here’s the part that made my blood boil.
Money in a rescue like this flows to the players with the MOST power. The developer. The lender. The ones with the lawyers, the lobbyists, and the balance sheets big enough to absorb the hit anyway.
The one person with the LEAST power, the retail buyer who overpaid into a top the system manufactured, gets skipped entirely.
That’s not a rescue. That’s a sort.
Bailouts roll uphill. Always have. The water gets bailed out of the boats that can already float, and it gets dumped right on the head of the one person actually going under.
So when I say this deal went too far AND not far enough, that’s the dichotomy.
Too far, because it props up the players a free market should let clear. Things need to clear for capital to flow. I believe that to my core.
Not far enough, because if you’re going to intervene at all, in the name of affordability, and you walk right past the regular family who’s drowning… then this was never about them. It was about clearing a balance sheet and getting the photo.
The bucket reached the developer’s boat. It rowed past the swimmer.
If you’re the one underwater
Maybe this is hitting close. Maybe you bought near the top. Maybe you’re staring at a number you don’t want to look at.
Read this slowly: holding is allowed. Hiding is not.
You are allowed to hold an asset through a down cycle. That is a legitimate, grown-up position. What you are not allowed to do is refuse to look. Avoidance is the only move that guarantees the loss.
So tonight, open the file you’ve been avoiding and get your three numbers:
- Your real monthly hold cost. Not the fantasy. The true number, with everything in it.
- Your actual break-even price. What does this unit need to be worth before you’re whole. Write it down.
- The date the math turns. Between rent, paydown, and a realistic recovery, when does this position get back to even. Put a year on it.
Now you’re managing a position, not praying over a listing. Rent it. Refinance it. Restructure it. Or hold it on purpose, eyes open, because the date pencils. A plan beats a feeling every single time.
And if you’re an operator with capital and patience? This is exactly where the real opportunity lives. Not just the developer inventory everyone’s watching. The motivated individual seller nobody is helping. Just promise me one thing… buy the math, never the headline. So you’re never the one underwater next cycle.
Go beyond the headline
This onion had more layers than the comment section ever bothered to peel.
One layer was the blame aimed at the wrong target. That was Part 1.
This layer is the person the whole deal forgot. The one with the least power and the loudest silence around them.
We can hold the market accountable and still have a heart for the family in 1402. Those two things are not in conflict. Both can be true. Most real things are.
Keep peeling. Keep thinking past the headline. The easy take is always one floor up. The truth is usually a few floors down.
You’re sharper than the noise. I’ve believed that about you since the first piece, and I believe it now.
In your corner,
Russell Westcott
#Inspire # Encourage #Love
