September new-home sales came out Tuesday, and they say builders are still paying to move houses. Sales ran at a 676,000 annual rate, down 5.3% from a year ago. The median new-home price was $400,400, down 3.9%. Builders have 476,000 homes for sale, 8.4 months of supply. The South fell 6.6% and is still about 61% of all new-home sales.

With that much supply, the cheapest lever a builder has isn't the price, it's the rate. Here's what that does to a flip that sells anywhere near new construction.

Take a $260,000 loan. At Mortgage News Daily's 7.33% the payment is $1,788. Buy the rate down a full point to 6.33% and it's $1,614. Now hold the payment at $1,788: the builder's buyer can carry about $287,900 of loan, roughly $28,000 more than the buyer walking through your house. A half-point buydown is worth about $13,400.

Your resale buyer doesn't get that subsidy, so the gap has to show up somewhere else: in your price, in a seller concession, or in a better house. If I were underwriting a flip within reach of a new subdivision right now, I'd budget a concession of at least two points of the sale price and make sure the deal still clears 70 to 75% of ARV, less repairs and closing costs, after it. Plenty of deals that look fine at list price don't.

Rates themselves have been parked. That 7.33% held three sessions in a row, the 10-year is near 5.03%, and the Fed announces this afternoon with futures pricing about a 91% chance of a hold. Thursday's PCE inflation and GDP numbers could matter just as much for where the 10-year goes next.

The full write-up is on my website, which you can find through my profile. You can sign up there to get new reports by email.

For those of you selling flips near new subdivisions: what are buyers' agents actually asking for in concessions right now, and are the builders in your market still leading with rate buydowns or have they switched to straight price cuts?