What is S&P 500 Homebuilders pricing in?

 EmailPrint This Post Print This Post

I last week posed the question “Is real estate rolling over?” in a post including fairly bearish commentary from Robert Cambell’s Campbell Real Estate Timing Letter.  I also included a chart of the SPDR S&P Homebuilders ETF – ticking all the boxes of a cyclical bull market – and pondered on whether the stock market was getting it wrong.

Here is the chart again:


Source: StockCharts.com

David Rosenberg, chief economist and strategist of Gluskin Shedff & Associates, provides more food for thought, stating that his regression analyses show the Homebuilders Index to be pricing in the following:

• Housing starts: pricing in a level of 800-900k (versus 575k currently)

• Existing home sales: pricing in a level of 5,500k (versus 5,050k)

• NAHB Housing Market Index: pricing in a level of 35 versus 15 actual.

Is this the most expensive part of the US stock market?

Did you enjoy this post? If so, click here to subscribe to updates to Investment Postcards from Cape Town by e-mail.

OverSeas Radio Network

Leave a Reply

You can use these HTML tags

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>




Top 100 Financial Blogs

Recent Posts

Charts & Indexes

Gold Price (US$)

Don Coxe’s Weekly Webcast

Podcast – Dow Jones

One minute - every hour - weekdays
(requires Windows Media Player)
newsflashr network
National Debt Clock

Calendar of Posts

Feed the Bull