Home builders are feeling more confident in January
There are promising signs in the housing market — share prices of the nation’s largest home-building companies are up.
Builder confidence also ticked up slightly this month after hitting a three-year low in December, according to a monthly survey of home builders by the National Association of Home Builders.
In January, stocks for home-builders moved upwards from the month before, but they remain down by at least 29 percent over the last year, according to a report by the Wall Street Journal. Beazer Homes USA Inc. saw a 21 percent increase in stock price from December, while D.R. Horton Inc. is up 7.6 percent.
Lennar Corp.’s stock price is up 12 percent from last month, likely due in part to a bump in year-end revenue and executive chairman Stuart Miller’s contention in a recent earnings call that slowing mortgage rate hikes are boosting the company’s pool of buyers.
Toll Brothers Inc.’s stock price is up 5.8 percent, after it took in a record $7.14 billion in 2018. But the company reported that contracts dipped 13 percent in the fourth quarter.
The Federal Reserve has tempered its benchmark rate increase projections in recent months, which has slowed down mortgage rate hikes, but the consensus among market watchers is that the federal funds rate will continue to climb in 2019, which could slow economic growth.
The home construction industry is also under pressure due to labor shortages and rising prices on materials. [WSJ] — Dennis Lynch
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