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Us Home Builders Stock Plunges On Wall Street

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Toll Brothers, which makes luxury homes, fell 14 per cent to $33.91 after trimming sales guidance for 2006.

The Philadelphia Homebuilding Index plunged 5.4 per cent on the news, which raised concerns that the boom in the housing market – a principal driver of the US economy for the past couple of years – was coming to an end. DR Horton, the second biggest builder in the US by market value, lost 9.3 per cent to $30.60. This was followed by Pulte Homes, down 8.9 per cent to $37.77 and KB Home, down 5.5 per cent to $63.74.

Home improvement companies struggled throughout the day. Home Depot and Lowes, two large companies in the sector, fell respectively 2.2 per cent to $40.57 and 2.3 per cent to $60.50.

This could very well be the start of the HPC in the US

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Guest consa

It is big news in America, all professional investors will be looking to get out now, global meltdown here we come

Anyone who has called the turning point in the rampant housing sector in the last two years has gotten it wrong. Each time it looked like things were cooling, they picked right back up.

Today, though, you can make the case that housing's over the top based on a growing body of evidence, the latest news of which comes from home builder Toll Brothers, which is reporting softening demand in some of its markets.

Toll's a bellwether because it caters to the luxury move-up market, which is often where housing first goes soft. If you add in mortgage rates that are now half a percentage point higher than they were two months ago, inventories of homes for sale that are at their highest level in more than a year as well as weak consumer sentiment, you can see a cold snap in the air.

All good things ...

:rolleyes::rolleyes:

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Guest Riser

More news on the US housing market, it seems that interest rates may also be the key trigger for the UK market, how long can Brown hold out before US rates and global inflation forces higher rates on hyper sensitive UK borrowers.

U.S. stocks drop on worry about housing slowdown

TROUBLE ON THE HOME FRONT

Economists have warned of a slowdown in the housing market because of a steady pace of interest-rate hikes. The average 30-year mortgage rate was 6.75 percent, according to BestInfo Inc. Rates are their highest since June 30, 2004, when the Federal Reserve began its cycle of rate increases.

Shares of Toll Brothers plunged 14 percent, or $5.50, to $33.91 on the NYSE after the company warned new home deliveries and earnings next year would probably fall short of its forecast. [iD:nN08274685]

The slide in Toll Brothers' shares helped push the Dow Jones U.S. Home Construction Index down 7.4 percent, the largest percentage drop in three years.

"Rising rates are starting to take their toll and maybe there is something to this bubble idea," said Bruce Zaro, chief technical strategist at Delta Global Advisors. "It would make us cautious about putting money into the home-building sector."

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More news on the US housing market, it seems that interest rates may also be the key trigger for the UK market, how long can Brown hold out before US rates and global inflation forces higher rates on hyper sensitive UK borrowers.

U.S. stocks drop on worry about housing slowdown

Agreed, ultimately a correction won't start until homeowners are forced to sell, (sorry to go over old ground here).

I have noticed many properties being withdrawn from the market after a period of time, obviously due to seller lethargy with the market.

The issue must be forced.

I do think that sooner or later a rise in IRs is necessary for the long term good of the economy.

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Bubb

A quick question, Countrywide seem not far off their high and obviously look like a good short.

Is there more to this stock than meets the eye? takeover target, rightmove sale or is that built in to price?

Any insight would be much appreciated.

Cheers

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  • 301 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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