The Bottom Line
Financing improved slightly last week, but not enough to change the economics of a marginal deal. The best opportunities still work with today’s financing, supported rent, realistic renovation costs and more than one viable exit.
Market Snapshot
| 10-year Treasury | 4.72% → 4.68% (-4 bps) |
| 2-year Treasury | 4.25% → 4.17% (-8 bps) |
| Freddie Mac 30-year benchmark | 6.69% → 6.67% |
| July CPI | +0.1% monthly / +3.4% annually |
| July construction PPI | +2.2% monthly |
| Existing-home sales | -1.7% monthly to 4.06 million SAAR |
| Median existing-home price | $434,100 (+2% annually) |
What It Means
Fix-and-flip: Stress-test a lower resale price, longer marketing period, seller concessions, a possible rate buydown and added carrying costs. An appraisal supporting the ARV does not guarantee enough buyers can afford it.
DSCR rentals: Qualification still centers on supported rent versus the proposed payment, taxes, insurance and HOA dues — confirm current, not aspirational, rent figures.
Ground-up construction: Confirm the completed-value support and rebuild the budget for a lower price and longer hold.
Five Things to Check This Week
- Confirm current comps support your ARV, not last quarter’s comps.
- Re-run the construction budget against current material pricing.
- Get an actual insurance indication rather than assuming the seller’s premium carries over.
- Stress-test the exit for a lower price and longer hold.
- Stress-test rental cash flow with current taxes and insurance, and protect liquidity for overruns, delays, vacancy and refinance risk.
ACP Financing Focus
Bridge-to-DSCR can provide time to purchase, renovate, lease and stabilize before permanent financing. Underwrite the refinance before closing—and build a second exit using a conservative sale.
Key question: Does the property have two realistic ways out, or does everything need to go perfectly?
Complimentary Preliminary Comp & Financing Analysis
Send the property address, estimated FICO, price or value, renovation budget, estimated ARV or rent, requested loan amount and exit strategy.
Steve Waller | ACP Real Estate Lending
(936) 522-8951 | [email protected]
Sources: U.S. Treasury, BLS, NAR, Freddie Mac, Census Bureau, Federal Reserve, NAHB and LexisNexis Risk Solutions. Market information is educational. Financing is subject to property review, appraisal, documentation, lender guidelines and final approval. This is not a commitment to lend.