joyofyoga

Homebuilders Near a Bottom: Five Stocks to Benefit

I'm with you Tom! My Mr. Lalijee is also trying to get out of these stocks. Why would a rationale person purchase a real estate stock?! There have to be some fundamental reason that those stocks will increase because surely there isn't a technical indication. No sane person would purchase a home today when they know the could pick it up for less in a year from now and even lower in two years. This is going to be a long, protracted real estate bear cycle. $1.5 trillion in arms are resetting this year, just THIS year, not next year. Next year there will be more. And people can't refinance at lower rate or lower payments so they are walking away from their homes. Not just individuals but block and communities of people. I see it every day in my business. Unfortunatley the media is focused on the big money, on Wall Street money, and then you can rationaize that it's only a small portion of their business. But the bottom line upshot is there is a glut of inventory on the market for sale and more becoming available every day. So that's the supply side, the inventory. Where is demand coming from? It's not like retail sales, say food. You have a big meal, you digest it, you need to eat again. How many homes can people live in at one time. The folks that already purchased are out of the market. The second home craze is a memory. There is no one to absorb the glut of inventory that is rolling down the tracks. Anyone who purchases real estate in the hope that it will go up in the near future is hallucinating.