“Timing when demand will come back from this pause is a little bit challenging, and I think it’ll take at least several months to sort of figure out,” Lacayo said. “You’ll see that come through in the earnings releases as we go forward, that there’ll be a certain amount of uncertainty at least for the first few months.”
ETF investors who are interested in gaining exposure to the home construction segment can look to homebuilder-related ETFs, such as the SPDR S&P Homebuilders ETF (NYSEArca: XHB), iShares U.S. Home Construction ETF (NYSEArca: ITB) and Invesco Dynamic Building & Construction ETF (NYSEArca: PKB).
These ETFs do not solely focus on home construction companies as they also include discretionary retail names. For example, XHB includes a 35.7% tilt toward building products, 9.8% household appliances, 8.7% home improvement retail, 7.2% home furnishings and 6.1% home furnishing retail. ITB includes 14.9% building products, 8.7% home improvement retail, 3.4% home furnishing, and 1.1% construction materials. PKB’s portfolio also includes names like Home Depot 5.4% and Lowe’s 5.3%, among others.
For more information on the housing market, visit our homebuilders category.