Home Builders Get a Reality Check

By Gunjan Banerji
The Wall Street Journal
July 17, 2019
Category: Business & Politics
Region: Canada, United States

Shares of home builders have been on a tear this year. But fresh housing data could hold them back. Home building in the U.S. declined in June, potentially putting a halt to an epic rally. …Big, publicly traded home builders… have soared this year, outpacing the S&P 500’s roughly 19% gain. …But several home builders inched lower on Wednesday after fresh data from the Commerce Department showed that housing starts fell 0.9% in June from the prior month. Meanwhile, residential building permits recorded the biggest monthly drop since March 2016. …Lower borrowing costs could help the housing market; rates for 30-year fixed mortgages recently fell below 4%. …But a continuation of sagging housing data could put an end to the rally, potentially weighing on other sectors. …These types of companies, which include Canfor, Interfor andWest Fraser, have fallen at least 15% each this year. [a WSJ subscription is required to access the full story]

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