XHB - Housing market remains hot but homebuilding stocks still have room to run: Alpha Tactics

The housing numbers out this week indicated the market is still on fire amid low mortgage rates. And homebuilding stocks are gaining momentum after a scare late last month.On Tuesday, the S&P Corelogic Case-Shiller composite index showed home prices rose at an annual rate of 7% in September, up 5.8% in August. The decline in mortgage rates in 2019-20 explains much of the recent uptick in home prices, DataTrek says.“From year end 2018 to now, these have dropped from 4.94 pct to 2.7 pct. That equates to a $319/month decline in a mortgage payment on a $250,000 loan, or 24 percent,” analysts at DataTrek wrote.While “the virus has certainly played a role in boosting US home demand, in our view the real driver of higher prices is lower mortgage rates,” they added. “As long as these remain low, house prices can still trend higher. That said, we doubt if mortgage rates

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Housing market remains hot, but homebuilding stocks still have room to run: Alpha Tactics