Want a 5% rate? Buy #newconstruction home

While the average mortgage rate remains stuck above 6%, buyers of new homes are getting a much better deal, according to one expert.

"So buyers out there today that are buying new homes are not paying 6.5% — the headline rate," John Lovallo, UBS homebuilders and building products analyst, told Yahoo Finance Live. "They’re paying under 5% in most cases."

That’s another big advantage that homebuilders have in this market — their financing — in addition to capitalizing on the low inventory environment in the previously-owned home market.

Builders "have the ability to do this because of the captive finance arms that they have," Lovallo said. "And we think that positions the public homebuilders in particular extremely, extremely well here in this environment."