Advanced Seller money. Deal fell apart. He won't give it back.

[Steven N.]

Advanced Seller $3,000 pre-inspection to help w moving costs (will never happen again). Inspection came back much worse than expected. Seller and I could not agree on a new selling price. He is refusing to give back the advance saying he spent it all. 

 Purchase agreement had inspection contingency. Explicitly states advance is due back to Buyer if property does not close for any reason. 

I know small claims court is an option I have but I feel like this property is their only real possession of value for me to collect on and they will sell it to someone else soon. 

I want to record an affidavit and memorandum of purchase agreement so that it cannot be sold to another person without me signing a termination after getting paid. 

I feel that him not giving back the advance shows me still having equitable interest in the property and I am in my right to file the affidavit.  

Can anyone advise?