Monday Morning Cup of Coffee: Is housing strong enough to weather rate hikes?

Monday Morning Cup of Coffee: Is housing strong enough to weather rate hikes?

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Despite positives, homebuilder shares fail to impress

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Prolonged tapering equals good news for lenders, but there are also beneficial factors for homebuilders, from rising prices to increasingly compelling demographics. The Wall Street Journal has more:

The problem is that these appear to have been priced in well before the prospect of less Fed bond buying and rising interest rates appeared. Despite headline after headline about rising home prices and even bidding wars, not a single major homebuilder has outperformed the broad market so far this year.

Barring a much more substantial rise in mortgage rates, the underlying impetus for the housing recovery remains intact. Construction and home sales probably have a long runway ahead of them—just don't bet the house on it.

Source: WSJ
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