Housing Market Tracker - Housing Stocks Review

Here's our summary of articles and data points on the housing market. It's part of Seeking Alpha's coverage of the real estate market and homebuilder stocks. Like all other topics and stock coverage from Seeking Alpha, you can have this sent to your Blackberry or desktop email by signing up for our no-spam free email subscription service.

Quote of the Day

"The housing shock is about half-way over. We expect home prices to fall through the end of 2008." - Ethan Harris, chief U.S. economist at Lehman Brothers (Seeking Alpha, Dec. 18th)

Homebuilders, Housing Stocks and Housing-Related Stocks

• Factory-Built Homes Provide a Green Alternative (Michigan Manufactured Housing Association Press Release, Dec. 17th): "Seventy percent of all manufactured housing factories have been qualified to build homes earning the Energy Star certification. Michigan Manufactured Housing Association member Palm Harbor Homes (PHHM) has made strides to save energy and reduce greenhouse gas emissions in the construction of their homes. As a result, the manufacturer has been awarded the title "2007 Energy Star Partner of the Year" by the U.S. Environmental Protection Agency. PHHM has added several features to their homes to increase overall efficiency, including programmable thermostats that... save up to 15% on energy bills and mini/vertical blinds that control energy entering your home."

• Illinois Tool Works Down 4% After Lowering Guidance (Joan Wickham in Seeking Alpha, Dec. 17th): "Illinois Toll Works (ITW) lowered its Q4 and annual guidance, citing ongoing weakness in the North American market "and as a result lower than expected base revenues and operating margins." ITW has suffered from the U.S. housing slump which has lowered demand for products related to construction. However, the firm's U.S. activity has dropped to 50% of sales from 65% of sales over the last ten years. The company also said that acquisitions were cutting into profit margins."

• Construction Begins On New Potomac Yard Project (Washington Business Journal, Dec. 17th): "The city of Alexandria and Potomac Yard Development LLC, a collaboration between Centex Corp. (CTX) and Pulte Homes Inc. (PHM)... began construction on a mixed-use project in Alexandria's Potomac Yard. The project... includes a $6.6 million fire station, the city's first in more than 30 years. Centex and Pulte paid for the fire station and provided the land. Station at Potomac Yard also includes a four-story apartment building with 64 affordable and work force units and 1,500-sf of retail... When completed in 10 years, [the project] will contain 1,683 residential units, 1.8 million-sf of office space, 120,000-sf of retail and 300 hotel rooms."

• Home Building Coming Back In Southeast Fort Worth (Star Telegram, Dec. 17th) Texas: "Since 2002, KB Homes (KBH) has built nearly 60 houses in southeast Fort Worth... Nearly 1,000 new homes are planned over the next few years by developers... In March, developer Happy Baggett bought 170 acres at the former Masonic Home site... where he plans 550 houses. Several national home builders are interested in the project... The houses will start at about $150,000 and target second- and third-time buyers, he said. Baggett said the national builders are drawn to Fort Worth because the housing market is still strong, unlike in other parts of the country."

• Buffett Takes Global Outlook To Balance Portfolio Risk (NY Post, Dec. 16th): "Although Buffett has long warned of a housing bubble, [Berkshire Hathaway (BRK.A) (BRK.B) owns] a basket of companies that couldn't be more vulnerable to a housing recession: Shaw Carpet, Benjamin Moore paint, Buffett's much-loved Nebraska Furniture Market, [and] the nation's second-largest realtor - Home Services of America. But even some of his highly publicized stock holdings are plays in part on the US housing market. Buffett began buying USG (USG)- the huge building materials company - late last year, and his investment in Moody's (MCO) (which has been accused of grade-inflation in rating all those bond derivatives) has been a disaster. He also has a stake in Bank of America (BAC)."

• Lennar Sheds 1,200 Home Sites Locally (Orlando Business Journal, Dec. 14th): "South Florida homebuilder Lennar Corp. has... unloaded nearly 20,000 home sites nationwide -- including more than 1,200 in Central Florida. Industry experts see the move as a way for Lennar to back away from developing land and focus on... building homes. Metro Development Group LLC... paid Lennar (LEN) an undisclosed sum for 8,300 home sites in seven counties in Florida, including 1,200-plus lots in Brevard and Polk counties. Metro Development decided against buying additional raw land owned by Lennar in DeLand and Osceola County for now, but it may buy that property in the future, says Rob Ahrens, Metro Development's VP."

• Black & Decker Drops on Warning (Roy Mehta in Seeking Alpha, Dec. 14th): "Shares of Black & Decker (BDK) hit a 52-week low Friday after the company lowered its profit target because of a product recall and weak sales in North America. Excluding a $2.36/share favorable tax settlement, the tool maker said it would earn $1.03/share in Q4 and $6.00/share for the year. The company's previous estimates were $1.55-$1.65/share for the quarter and $6.50-$6.60 for the year. The earnings target includes a $25 million recall of a cordless drill, but excludes any potential patent recovery from a component supplier. BDK added it will report a low single-digit decrease in rate of sales, after forecasting a modest growth earlier."

• Toll Brothers Director Exercises Options (Chron.com, Dec. 14th): "A director of Toll Brothers Inc. (TOL), the nation's largest builder of luxury homes, exercised options for 60,000 shares of common stock, according to a SEC filing. In a Form 4 filed with the SEC Thursday, Richard J. Braemer reported he exercised the options on Wednesday for $6.39 apiece, sold 20,000 shares on Thursday for $20.62 to $20.72 apiece. Insiders file Form 4s with the SEC to report transactions in their companies' shares. Open market purchases and sales must be reported within two business days of the transaction."

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