if sector rotation occurs, this goes down; if consumer spending and sentiment goes down, this goes down; if new home prices go down, this goes down....up here at 5 1/2 year highs, I don't get the risk/reward for being long. Anyone have the bull argument? thanks
"As the housing market continues to improve, house flipping is coming back into fashion—but just like Capri pants—not everyone is cut out for it"
Fox Business 4/3/13.
Housing inventory is starting to dry-up in many parts of the country. Almost every data point shows an improving housing recovery. The house flippers are back in my area and they got money. Consumer spending and sentiment may be down in Michigan (Why bother? The Motown area has been dead for years) but spending is alive and well in my area and many parts of the country.
We were due for a little pullback, Warren Buffett says it never feels good when it's the right time to buy. If you are looking for a part of the market that has a good chance of another leg up I think this broad housing related ETF is a good bet.
For the period you mention there was a retraction in home building. Excess homes for sale along with forclosures. Now things are picking up. The demand for homes will increase given time. Time is on your side if you are a long term investor.
The XHB follows all builders and may increase in value due to pent up demand. Just like the autos will.