Tuesday's CPI comes with no yearly number. How are you pricing exits this week?

Question

Heads up for anyone pricing a resale or a refi this week. Tuesday's October CPI (7:30 a.m. Central) won't include an all-items or core yearly rate. BLS never collected October 2025 prices during last year's shutdown, so there's nothing to compare against. Gasoline, new vehicles and used cars keep their yearly numbers. Everything else is monthly only.

Consensus is around +0.24% headline and +0.2% core. September was +0.6%. Then the Treasury sells $42 billion of 10-year notes at noon Central. The 10-year closed Friday near 4.86%, and Mortgage News Daily's 30-year is 7.17%, tied for its lowest since September 22.

The way I'm looking at it on a flip: hold the end buyer's payment at about $1,787 a month, which is $264,000 of loan at 7.17%. At 7.05% that same payment carries about $267,200. At 7.35% it carries about $259,300. That's roughly $7,900 of exit-buyer budget riding on one morning.

On a $250,000 rental takeout the gap is smaller, about $1,672 vs $1,722 a month in principal and interest. But if your DSCR only works at the better number, I'd restructure now rather than wait and hope.

My own rule this week is not to move an offer until the 10-year settles after the auction. The first headlines at 7:31 are going to be messy without a yearly number to anchor them.

I put out a short brief like this most mornings on my website, which you can find through my profile.

Question for the group: when you underwrite a flip that won't sell for five or six months, what rate do you assume your end buyer gets? Today's, or something with a cushion built in?

Noah Wright · Answer

Steve, showing the move in dollars of buyer budget is the useful part, since that's the number that decides whether a flip still pencils. I don't settle on one rate for the exit. I run the resale at your 7.35% case and see if the margin survives it. Then I run the interest on the flip loan past the expected sale date, because a listing that sits costs you every month it waits. The exit rate is a guess five or six months out, but your own carry is a cost you can count exactly before you buy, so that's the line I'd never leave thin. A guess gets a cushion, a known cost gets counted in full.

Ametria Chaney · Answer

Steve, I always underwrite the exit with a cushion, and I'd rather be the person who was too careful than the one explaining to a seller why the flip won't move. If the home won't sell for five or six months, I assume the end buyer is borrowing at today's rate or a little higher, and I price the home so the payment still works at that level. That means being honest about the exit price up front — if the numbers only work when rates fall, the deal isn't a deal yet, it's a bet. The other thing I do is keep the exit flexible in my head: a price that works for an owner-occupant, and a backup plan if the home has to rent for a while. Rates and inflation headlines will move around; a deal that only works in the best case usually isn't worth the stress.

Tuesday's CPI comes with no yearly number. How are you pricing exits this week?

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