Elijah J. Behringer

Published: May 23, 2025

Introduction: A Frozen Market in Paradise

Resort towns that once sizzled with real estate deals during the pandemic boom are now eerily quiet. Listings are sitting, buyers are hesitating, and rental costs are squeezing locals. For many, it feels like a housing market in limbo—too expensive to buy, too competitive to rent, and too uncertain to invest.

But all is not lost. Whether you’re a seller or an aspiring buyer trying to get your foot in the door, there are paths forward—even in a frozen market.

For Sellers: Strategies to Unlock a Sale

Sellers in resort markets often face a tough reality: 2021 prices are gone, but many are reluctant to adjust expectations. Here are strategies to improve odds of a successful sale:

1. Reprice Based on 2024-2025 Fundamentals: Look at recent sales, not pandemic peaks. Overpricing leads to extended days on market and reduces negotiating power long-term.
2. Offer Buyer Incentives: Consider offering to buy down mortgage points or cover closing costs to offset higher interest rates.
3. Target Local Buyers and Long-Term Renters: Highlight livability over short-term rental potential. The pandemic-era Airbnb gold rush is over.
4. Consider Seller Financing: If you own your property outright, offering to finance a portion of the sale at competitive rates could attract serious buyers who can’t get favorable terms from traditional lenders.

For Buyers: Opportunities Amid Uncertainty

Even in a tight credit environment, buyers can find openings—especially if they’re willing to be creative and patient:

1. Look for Stale Listings: Homes that have been on the market 90+ days may offer extraordinary negotiability.
2. Negotiate More Than Just Price: Ask for seller concessions like rate buydowns or furniture inclusions.
3. Focus on Cash Flow, Not Appreciation: If buying as an investment, ensure the math works with realistic rental income—not 2021 projections.
4. Use the Slump to Save and Plan: The market may not move fast, but that gives buyers time to save more and build stronger credit profiles.

A New Chapter for Resort Towns

The days of fast flips and speculative Airbnb profits may be behind us, but that opens the door to something more sustainable. If buyers focus on long-term value, if sellers reset expectations, and if local governments empower residents—not just investors—then these markets can find balance again.

A frozen market doesn’t mean a dead market. It means the system needs to thaw slowly and reset around real community needs, not just short-term gains.

Published: May 23, 2025

Introduction: The Rate Cut Fantasy

Financial pundits keep speculating: when will the Federal Reserve finally pivot and work to slash interest rates for home financing? But that pivot isn’t coming anytime soon. While real estate buyers might be waiting for better lending terms from banks influenced by Fed monetary policy, the Fed is playing a much higher-stakes game—preserving the credibility of the U.S. dollar, keeping inflation expectations anchored, and preventing a loss of faith in fiat money itself.

The Debt Trap: Why the Fed is Cornered

The U.S. federal government currently owes over $34 trillion, and that number is growing fast. In an ordinary environment, the Fed could work to lower rates to spur growth. But today, doing so would risk re-igniting inflation—which already hit 9.1% (according to the CPI) in 2022 and still lingers above the Fed’s target.

If inflation returns, so does the risk of a broader loss of confidence in the dollar. To avoid this, the Fed is effectively forced to hold rates high to protect the purchasing power of the currency. But this comes at a cost: every interest rate hike increases the federal government’s debt servicing burden.

The Fiscal Cost of High Rates

With trillions in debt rolling over into higher interest rates, the U.S. is paying dramatically more to service its obligations. For context:
– A 1% rate increase on $34 trillion in debt = $340 billion in extra annual interest.
– At current rates (5%+), interest payments could soon exceed $1 trillion/year.

That’s more than the government spends on defense—and almost as much as it collects in income taxes. High rates are compounding fiscal fragility, but the alternative—cutting rates and risking inflation—is seen as even worse.

The Political Dilemma: Congress and the Debt Ceiling

Rather than reducing spending or increasing taxes meaningfully, Congress keeps raising the debt ceiling. Each time this happens, it signals that the government has no intention of slowing its borrowing. This feeds into inflation fears, and forces the Fed to act as the ‘grown-up in the room’ by keeping monetary policy tight.

In this environment, rate cuts are politically perilous. They would ease borrowing costs—but also confirm that the Fed has no control over inflation. So the Fed is stuck: protect its own credibility, or help Congress delay the reckoning. It’s choosing credibility—for now.

The IRS Expansion: Following the Money

As interest payments balloon and deficits deepen, the Treasury needs more revenue. Enter the IRS. In 2022, Congress approved an $80 billion funding boost for the IRS, enabling the hiring of tens of thousands of new agents and massive expansion of enforcement capabilities.

This isn’t just about closing the ‘tax gap’—it’s about survival. A government with this much debt must extract as much revenue as possible just to cover interest costs. The IRS is the extraction arm of a state that can no longer rely on inflation alone to service its debt.

The Fiat Currency Catch-22

At the heart of this issue is a core paradox: to maintain trust in fiat money, the Fed must fight inflation aggressively. But in doing so, it makes the government’s debt load unmanageable. This is the classic ‘fiscal dominance’ trap—where monetary policy is no longer independent, but must serve fiscal needs.

If the Fed cuts rates too soon:
– The dollar weakens,
– Inflation returns,
– Asset bubbles re-inflate,
– And confidence in the system erodes.

If it holds rates high:
– The Treasury bleeds more cash,
– Congress faces pressure to tax more or spend less,
– And the IRS tightens its grip on enforcement.

Neither option is politically popular—but the Fed knows it must preserve long-term credibility above all else.

Conclusion: No Pivot in Sight

The idea of imminent rate cuts is wishful thinking. The Federal Reserve isn’t managing just the business cycle—it’s managing the survival of the fiat system itself. Until inflation is decisively crushed and fiscal policy becomes sustainable (don’t hold your breath), high interest rates are here to stay.

That means:
– Real estate prices in the mountains will continue to slowly fall as the market corrects,
– Credit will remain tight,
– And government austerity may arrive in the form of audits, not spending cuts.

So next time someone asks when the Fed will pivot—just smile and say, ‘Not until trust in the dollar is bulletproof again.’

Published: May 23, 2025

Introduction: The Mystery of the “For Sale” Sign Glut

Drive through towns like Lake Tahoe, Sedona, or Lake Arrowhead, and you’ll notice something striking: real estate listings are piling up. Homes that would have sold within days in 2021 are now sitting idle for months. Buyers are hesitant, sellers are stubborn, and the local economies seem stuck. Why is this happening—especially at a time when much of the country is experiencing a housing shortage?

2020–2021: The Perfect Storm for Resort Real Estate Speculation

The story starts in early 2020. As the COVID-19 pandemic swept the globe, the Federal Reserve slashed interest rates to near-zero and launched a multi-trillion-dollar Quantitative Easing (QE) program. Mortgage rates plummeted below 3%, stimulus checks hit consumer bank accounts, and the newly remote workforce looked for an escape from urban density.

Enter the resort town. With stunning scenery, room to breathe, and (at the time) affordable prices, places like Park City, Aspen, Joshua Tree, and Asheville became hot commodities. Buyers included:
– Remote workers seeking lifestyle upgrades,
– Investors chasing Airbnb gold,
– Urbanites hedging against future lockdowns.

The frenzy was turbocharged by leverage. Easy lending terms and expectations of endless demand turned vacation homes into speculative assets, not just places to unwind. Prices soared—some by more than 40% in 18 months.

2022–2023: The Fed Slams the Brakes

By mid-2022, inflation was raging—the Consumer Price Index indicated inflation hit 9.1%. The Fed responded with its most aggressive rate hikes since the 1980s, raising the federal funds rate from near-zero to over 5% in a matter of months. Mortgage rates doubled, going from 3% to over 7%.

Simultaneously, the Fed began Quantitative Tightening (QT), pulling liquidity out of the national banking system. As money became more expensive to lend, real estate markets—especially speculative ones—began to freeze. Airbnb saturation became a real problem, as nightly rates fell and vacancies rose.

Suddenly, many investors were holding properties that:
– Couldn’t be refinanced,
– Were no longer profitable,
– Had limited resale demand due to high borrowing costs.

2023–2025: Inventory Rises — But Demand Doesn’t

This is where we are now. Resort town inventories are growing fast. Listings are staying up for 60, 90, even 120 days or more. Sellers still remember 2021 prices; buyers are facing 7%+ mortgages and a very different economy.

The result is ‘high inventory stagnation’: supply is plentiful, but demand is evaporating. Unlike primary markets—where owners need a place to live and low inventory supports prices—vacation markets are entirely discretionary. Owners don’t *need* these homes. Buyers are increasingly unwilling to take on inflated prices with higher financing costs.

What Makes Resort Markets Uniquely Vulnerable

Resort towns aren’t like the rest of the housing market. Here’s why they’re different:
1. Speculative Demand: Most buyers are investors or second-home seekers.
2. Non-Essential Use: These homes aren’t primary residences.
3. Overbuilt for Airbnb: Many towns over-zoned for short-term rentals during the boom, flooding the market with units.
4. Weak Local Economies: Few have enough full-time, year-round jobs to support home prices without outside demand.
5. Seasonality: Demand is highly cyclical—winter towns slump in summer, and vice versa.

These factors create conditions where price floors can fall out very quickly, especially if travel demand softens or financing becomes strained.

What Comes Next?

Expect a slow unwind. Prices may not crash, but they’ll decline steadily in real terms. Inventory will stay elevated unless interest rates fall dramatically or sellers cut aggressively. Towns that rely heavily on tourism and short-term rentals could see defaults rise and investor exits accelerate.

Some areas may introduce Airbnb restrictions to free up housing stock for local workers, further limiting income potential for second-home owners.

New buyers will likely demand much lower prices to justify the now-marginal returns. And unless the Fed reverses course entirely (which it’s unlikely to do in the short term), cheap money isn’t coming back anytime soon.

Conclusion: The Real Estate Boom’s Echo

What boomed the fastest during the pandemic is now echoing the loudest in its stagnation. Resort towns that once offered escape now feel frozen in time, with homes stuck in limbo.

This isn’t a housing crash in the traditional sense—it’s a confidence correction. And like all such corrections, it punishes the overleveraged and overoptimistic first. The rest will follow slowly, as the reality of higher rates, fewer buyers, and weakened cash flows settles in.

Real estate, like currency, depends on trust. And in the case of resort towns, that trust was built on the assumption that people would always want more vacation homes. That may still be true—but only at the right price.