Homebuilder ETFs Could Still Thrive Despite Rising

Related: Dow Stumbles as U.S.-China Trade Talks Stall

Even if a homebuilder does decide to take on a project, the increased costs eventually get passed on to the consumer, translating in higher real estate prices that will further affect the real estate market. Despite the extended bull market in U.S. equities, real estate has still been lagging the rest of the capital markets.

“In the short term, it is definitely hurting us,” said Skip Greene, a contractor in Kinston, N.C. “I hope that going through all this pain is worth it in the end. We’ve got a tariff war going on with China and Canada, and the result was that I couldn’t move ahead with building affordable housing.”

As the new tariffs kicked in today, homebuilder ETFs got kicked in the gut at the close of today’s market session–ITB was down 1.32%, XHB slid 1.32% and PKB retreated 1.02%. Whether it’s homebuilders, homeowners or ETF investors, all can agree the tariffs aren’t helping anybody.

“The tariffs don’t help anyone,” said Charles T. Wilson III, a third-generation builder in Durham, N.C.. “They’re not the correct tool to negotiate trade policy.”

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