zachpope . 25 November 2025

Builders Are Cutting Deals So Deep Even Warren Buffett Is Jumping Back In — And This Time, Regular People Benefit

 

The U.S. housing market is shifting in real time and two major trends are creating opportunities that haven’t existed in over a decade. Builders are quietly slashing prices, offering below-market financing, and rolling out incentives we haven’t seen since the Great Recession. At the same time, Warren Buffett is buying back into homebuilders after stepping out just a year ago.

And here’s the wild part:
For the first time, these opportunities aren’t just reserved for Wall Street. They’re available to everyday buyers and small investors.

Builders Are Feeling the Pain — And It Shows

It started with Invitation Homes, one of the biggest institutional rental owners in the country. They recently told analysts they’re getting “pretty significant discounts” when buying directly from builders.

That one statement tells us everything: Builders are under pressure.

  • Inventory is climbing

  • Homes are sitting longer

  • Sales pipelines are slowing

  • Carrying costs are piling up

Every unsold home becomes a liability, not an asset. Builders pay interest, insurance, taxes, and holding costs every month a home sits unsold. And when the pipeline stops moving, the entire machine breaks down.

So, builders do what builders always do when the market slows: They go where the cash is.

Historically, that meant institutional buyers like Blackstone, Invitation Homes, and AMH. But even those groups have pulled back. AMH has admitted many homes no longer meet their return thresholds due to higher interest rates and slower rent growth.

If the biggest buyers in the country are passing on deals, builders have to widen the net. And that’s exactly what’s happening.

The Incentives Are No Longer Going to Just Wall Street

Here’s where the shift gets interesting:

The best builder incentives today aren’t going to private equity.
They’re going to regular people — small investors, move-up buyers, and everyday families.

Why?

Because builders now care more about velocity than margin.
They’d rather take a 5–10% haircut on price today than slow production by 50% tomorrow.

Momentum keeps:

  • subcontractors working

  • lenders engaged

  • materials flowing

  • pricing stable

When momentum dies, everything else dies with it. So builders are protecting the machine — even if it costs them profits in the short term.

And the incentives they’re offering right now are some of the strongest in years:

  • $20K–$40K price cuts

  • 4.99% special-rate ARM financing

  • Longer rate locks

  • Builder-paid closing costs

  • Credits toward title and escrow

  • Even perks like landscaping or upgrades

It’s happening in the $350K–$500K range — the sweet spot for first-time homebuyers and small investors. These are homes in good neighborhoods, near schools, parks, and solid rental demand.

Lennar’s Investor Marketplace Changes the Game

One of the most important shifts is Lennar’s new Investor Marketplace — an online portal where anyone can evaluate properties the same way institutional buyers do.

You can:

  • browse inventory

  • estimate rents

  • run cash flow projections

  • analyze cap rates

  • toggle down payments

  • project appreciation

  • review expense assumptions

  • view financing structures

And the financing? A 7/6 ARM at 4.99% — far below what you’ll find at traditional lenders right now.

This is the type of access large private equity firms used to get behind closed doors. Now teachers, firefighters, small business owners, and first-time investors can run the same numbers with complete transparency.

If you’ve been waiting for a foothold into real estate investment, this is it.

What These Deals Actually Look Like

Let’s say you’re eyeing a $450,000 new construction home. The builder drops the price to $420,000 and offers you a 4.99% 7/6 ARM.

With 20% down:

  • Your P&I payment sits around $1,800

  • The rental income is estimated at $2,200

You’re positive cash flow from day one — before factoring in depreciation or tax advantages — on a brand-new home with low maintenance and minimal repairs.

And you have seven years on the low-rate ARM before it adjusts. That’s plenty of time to:

  • refinance

  • sell

  • or convert to a fixed-rate loan

For buyers who’ve been priced out for two years, this is a meaningful window.

Investors Are Back — But Not the Ones You Think

According to CRE Daily, investors now make up 30% of all single-family purchases — the highest since before the Great Recession.

But here’s the shocker: Only 5% of those investors are institutions.
The other 95% are regular people buying one or two homes.

Why?

Because traditional homebuyers have been sidelined by rates.
And investors — especially small investors — are stepping into the gap.

Builders are embracing this shift. They’d rather sell to five small buyers today than wait on one hedge fund that may never call back.

Warren Buffett Is Quietly Loading Back Up

Let’s talk about the Oracle of Omaha. In 2023, Berkshire Hathaway bought nearly six million shares of D.R. Horton, along with positions in Lennar and NVR. Then, unexpectedly, they sold most of the D.R. Horton stake in 2024. Analysts debated whether Buffett had miscalculated or just taken short-term profits.

But in 2025?

Buffett is back — hard.

  • 1.5 million more shares of D.R. Horton

  • Over $800 million pumped into Lennar

  • Significant additions to NVR

All done quietly, through filings, without press conferences or public commentary.

It’s not unusual for Buffett to bet long on housing — he owns Clayton Homes, HomeServices of America, and other real estate-adjacent companies.

What is unusual? This pattern of buying in waves. It signals something important:

He sees a window. Not a perfect moment — a window.

One where:

  • prices are soft

  • margins are thin

  • incentives are strong

  • capital is cautious

  • supply is high

  • and opportunities are hiding in broad daylight

Buffett knows the one thing the market keeps forgetting: We’re still millions of homes short in the U.S. housing market.

Housing demand isn’t going away. It’s just waiting for the right moment to surge.

So What Should YOU Do Right Now?

Here’s the playbook I recommend for buyers, investors, and anyone watching this market closely:

1. Target high-inventory markets.

Focus on the Sun Belt and regions with new construction sitting longer than average.

2. Study builder incentives carefully.

Don’t just look at price cuts — look at rate buydowns, closing credits, and total cost of funds.

3. Understand your financing.

If it’s an ARM, know the adjustment caps and timelines. If it’s fixed, know your break-even point.

4. Play defense with your numbers.

Run conservative cash flow estimates. Assume flat rents. Don’t rely on appreciation alone.

5. Work with a pro who understands inventory-driven markets.

You need someone who knows:

  • builder incentives

  • lender specials

  • rate structures

  • timelines

  • and how to negotiate without getting burned

That’s where my team comes in. We live in this market every day, and we know how to navigate it safely and strategically.

Final Thoughts: The Window Is Open — But Not Forever

Builders are cutting deals deeper than they have in years.
Buffett is reloading his positions.
Small investors are stepping in while traditional buyers watch from the sidelines.

This isn’t a time for fear or hype.
It’s a time for clarity, preparation, and smart action.

Run the numbers.
Know your market.
And when the right deal shows up?

Move.

If you’re ready to talk strategy, financing, or whether now is the moment for you — reach out. Let’s build a plan that makes sense for your goals.

Written by Darin Hunter | Mortgage Professional |