KBWY - Homebuilders Are Prepared For A Slowdown

• Over the past two years, the housing industry has benefited from the pandemic and a favorable economic backdrop driven by consumers with geographical flexibility, low-interest rates, and a strong job market.
• The housing tailwinds seen during the pandemic provided a strong operating environment for homebuilders, and credit spreads across the industry were among the tightest in the high-yield market.
• Homebuilders will continue to see volatility due to an uncertain macroeconomic backdrop, but we continue to focus on builders with conservative balance sheets, limited near-term maturities, and proven track records of success in managing through downcycles.

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