TOL just reported better than expected numbers. This is no longer an aberration, but a trend. Expect to see homebuilders and construction material companies beat estimates handedly. If you’re still living in the dark ages of 2008, you’re missing out on one hell of a housing recovery. Go buy some property and quit with the negativity already; you’re making me sick.
Here is some housing data of some of America’s biggest cities. You cannot argue with the data.
And here is the national data.
I’ve been eying a number of stocks to buy, because it’s my belief housing will continue to do well. I’m so fucking conflicted about the economy, it’s ridiculous. On one hand, the numbers are great and expectations look good. On the other, if they remove the mortgage interest deduction, one has to surmise housing is going to take a hit.
Here are my favorites.
TOL, BZH, PHM, SPF, LEN, RYL, KBH, HOV, DHI, MTH, GFF, USG, OC, SHW, VAL, ANGI and Z.
The question is: will the government fuck up the recovery through onerous taxes?
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Sure, there’s some improvement, off of a mulit decade low….but there are also more than 11 million home/mortgages underwater, more than 7% of all mortgages are 90 days or more past due, there are 1.5 million houses in Bank inventories and very little prospect for employment and income growth in the US. Bet on the housing “recovery” at your own peril.
Shadow inventory is important to track.
shadow inventory is nonexistent in top tier markets where there are actually jobs.
Been to a bank in Coastal Florida?
Whatever it is, it’s a huge market with tons of “top tier” property in shadow inventory.
When I said “top tier”, I wasn’t referring to the price of bullshit speculative condos.
Picking and choosing shit markets with shadow inventory (FL, Vegas, Detroit) to use an an example is delusional.
Look at the shadow inventory numbers in Greater NY Metro, Virginia/DC/Maryland or SF Bay Area, then look at the month’s worth of available inventory for sale. If anything, the undersupply for those regions is a larger cause for concern as they’re one of the few places in the US where middle class and upper-middle class jobs actually exist due to interest-rate/tax policy making the rent-vs-owning a home at historically favorable levels.
Delusional, to use your term, would be an attempt to diagnose the state of the Housing market while ignoring the fourth largest state in the country with 18 million residents, a 13% 90 day delinquency rate and literally billions of dollars in “top tier” (detached unit) on banks books.
If bullish on housing I would just buy the ITB etf which is pure home builders as opposed to the more familiar XHB which also includes Cos like HD,L, etc.
Plenty of underwater homes here in Central Florida but it has been improving with many multiple offers being placed on homes for sale.
There is a problem with the foreclosure pipeline (takes many months to get through the process) and there remains plenty of it. Foreclosures are still stacked up and Banks are holding off on dumping them all at once.
PS Watch chips today- they will fly.
I agree with your post, but the Zillow Home Value Index uses some mystery algorithm that is very inaccurate, at least here in Boston. Better to analyze price per square foot.
You can always find shadow inventory in places that are doing the worst. But overall housing is rising, as you hear from TOL’s report.
i hope this trend continues. but tol is a luxury home builder.
Housing is the reason I bought BSET. Not a homebuilder, but directly connected to the recovery. If you plot the BSET chart against TOL, they have the same basic CockNBalls pattern since June.
What tax break(s) will they take away to generate $800 bil. in additional tax revenue?
Who knows what Clowngress will do? Anyone’s guess is as good as anyone else’s, unless a person has inside info.
The economic recovery would be better if it focused on the middle class directly. But not many of the people with the power care about the middle class. Because the middle class does not finance their campaigns.
Still the recovery is happening. But it is happening through trickle down from the 1%, rather than through direct recovery of the middle class. Trickle down is less efficient, more expensive, & takes longer. But it does work eventually.
That being why the luxury homebuilder TOL is recovering first.
Tol is upper middle class
Another chance to reload and go long SMH etf right here as AAPL makes a new daily low and yet INTC is saying something else (as is AMAT, KLAC,etc.)
maybe can also play housing thru BAC … is anyone more exposed to the ups & downs of housing?
… or WFC (30% of all 3rd quarter mortgage origination), USB (4.5%),JPM (10%). BAC had about 5% and Quicken had about 5%.
They do make good $$ on origination fees and costs.
I used to represent a major S&L in South Fl. and the profit was staggering but then again that was a long time ago (gas was .85 a gallon).
The builders are the direct play
Friend of mine got a $250k reduction in his mortgage from the gov’ment when he stopped paying his mortgage.
Where is that money coming from?
There’s no recovery, only a shell game and money printing. Bankers are filling the holes in their balance sheets with wheelbarrows of free tax payer money.
There was a new condo project in San Diego that guaranteed any buyers cash back if they bought and a unit sold below their purchase price. Years later they still have units for sale at rates laughably above market to protect themselves from having to pay out.
my friend u r a dumb fuck
The Tax Raise fetish continues
Impressive numbers, Fly. Good to see the US housing market turning around.
Building is booming in Minneapolis
http://www.startribune.com/local/minneapolis/181939101.html?clmob=y&c=n&refer=y