In February, pending home sales hit a new low, reports Alan Zibel for the Associated Press. The National Associated of Realtors’ index fell to 84.6, down from January’s 86.2. Last February, the index was at 107.6. Economists had been expecting the index would move up slightly, to 86.3.
The index began in 2001 at a reading of 100. Its previous low was 85.8, notched last August. One economist predicts that home sales will fall by another 5% to 10% before making a turnaround at the end of the year.
Homebuilder ETFs are about 2.5% lower midday, while real estate ETFs are down slightly at less than 1%:
- iShares Dow Jones Real Estate (IYR), up 13.5% in the last month
- iShares Cohen & Steers Realty Majors (ICF), up 15.7% in the last month
- iShares Dow Jones US Home Construction (ITB), up 31.4% in the last month
- SPDR S&P Homebuilders (XHB), up 26% in the last month
For full disclosure, some of Tom Lydon’s clients own shares of XHB.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.