With mortgage rates hovering around 6% and home prices that have surged roughly 50% in many markets since 2020, navigating today’s housing market feels increasingly challenging for prospective buyers. However, real estate investor Grant Cardone argues that the biggest obstacle isn’t the market conditions themselves, but the mindset buyers bring to their home search.
In a recent interview with Business Insider, Cardone outlined three common mistakes he believes are preventing buyers from making progress in the current housing market. While his perspective comes from a high-profile investor who has purchased billions of dollars’ worth of real estate, his advice challenges conventional house-hunting wisdom.
Rethinking the Housing Market Mindset
According to Realtor.com’s 2026 housing forecast, mortgage rates are expected to hover near 6.3% this year. Yet Cardone argues that many buyers have adopted a defeatist attitude that prevents them from actively pursuing opportunities. “If you go and believe in that, then you’ll never find it,” he told Business Insider regarding the “priced out” narrative.
This perspective contrasts with well-documented affordability concerns. According to Nadia Evangelou, senior economist at the National Association of Realtors, the market has been in one of the toughest affordability environments in modern housing history. Mortgage rates jumped from around 3% in 2021 to above 7% in 2023, pushing typical monthly payments up by more than $1,000 compared to pre-pandemic levels.
The Federal Reserve Bank of Atlanta’s Home Ownership Affordability Monitor shows that affordability nationwide remains significantly constrained relative to historical norms. However, Cardone’s point is primarily psychological rather than mathematical, suggesting that buyers who accept the “priced out” narrative may stop searching for creative or unconventional solutions.
Pursuing Creative Financing Over Rock-Bottom Prices
Cardone also believes that focusing solely on the lowest-priced home is a misguided homebuying strategy. Instead, he argues buyers should prioritize properties where flexible or creative financing options might be available.
He specifically recommends targeting two types of homes: those with no remaining mortgage and those with low-interest existing mortgages. In both cases, sellers may be open to non-traditional arrangements such as seller financing, assumable mortgages, or lease-to-own structures.
This approach has merit in limited but realistic situations. According to Redfin, only about 2.5% of U.S. homes changed hands over the first two-thirds of 2024, marking the lowest turnover rate in at least 30 years. Many homeowners were locked into mortgage rates below 5% and were reluctant to sell, potentially creating opportunities for buyers who can negotiate creative terms.
Additionally, research from the National Association of Realtors suggests that a 1% decline in mortgage rates could add roughly 5.5 million households to the pool of potential buyers, underscoring how sensitive affordability is to interest rates. However, creative financing arrangements can be legally and structurally complex, may require larger down payments, and are not widely available in competitive markets.
The Location Premium Strategy
Cardone’s final recommendation echoes an enduring real estate principle: location matters more than almost anything else. He believes buying the worst house in a top-tier location beats buying the best house in a mediocre area. “It matters 10x more,” he told Business Insider, noting that compromising on location has cost him in his career of purchasing roughly $6 billion worth of real estate.
Cardone advises buyers to prioritize areas with higher discretionary income and the presence of established national retail chains such as Whole Foods, Starbucks, and Chipotle, which he views as signals of economically strong neighborhoods. This advice aligns with longstanding real estate research showing that properties in desirable locations tend to appreciate more consistently and hold value better during market downturns.
Meanwhile, prime locations come at a premium. For buyers already struggling with affordability, prioritizing top-tier neighborhoods may mean accepting a much smaller, older, or more outdated property than originally planned. This trade-off works well for investors focused on appreciation, but families prioritizing livability and space may find the advice more difficult to apply.
Balancing Investment Advice With Personal Circumstances
It’s important to recognize that Cardone’s advice comes from an investor who has built wealth through real estate, not necessarily someone focused on the challenges of first-time buyers stretching to afford their first home. According to the National Association of Realtors, when viewed through the lens of income and purchasing power, access to affordable homes remains out of reach for many buyers.
Before adopting any house-hunting strategy, prospective homebuyers should get pre-approved to understand what they can actually afford, consider total monthly costs beyond the purchase price, and factor in maintenance, property taxes, insurance, and potential HOA fees. Understanding that creative financing often carries higher risk is essential, as is evaluating overall financial preparedness for homeownership.
Whether Cardone’s strategies gain traction among mainstream homebuyers or remain more applicable to experienced investors remains uncertain. Market conditions and individual financial circumstances will continue to dictate the feasibility of these approaches for different buyer segments.
