Homebuilders: A V-Shaped Vendetta

September 25, 2020 | Hoya Capital

Homebuilders: A V-Shaped Vendetta ETFs Homebuilders Sep 24 Written By An antihero of the prior financial crisis, Homebuilders have seemingly been on a vendetta over the last six months, asserting themselves as the unexpected leader of the early post-pandemic recovery. Homebuilders were slammed at the outset of the pandemic on fears that a coronavirus-induced recession could inflame a repeat of the Great Financial Crisis for the critical U.S. housing. Instead, the U.S. housing industry has roared back to life in recent months.

New Home Sales, Existing Home Sales, and Home Prices have all seen a substantial reacceleration this year. The sharp rebound in housing market activity has been aided by longer-term macroeconomic trends of favorable millennial-led demographics, historically low housing supply, and near-record low mortgage rates. Housing remains an “unloved” sector despite the compelling long-term tailwinds at its back. Homebuilders trade at deeply discounted valuations to the S&P 500 despite their stellar growth rates. ( This report was also featured on Seeking Alpha.

Click Here to Read. ) Homebuilders: A V-Shaped Vendetta An antihero of the prior financial crisis, publicly-traded homebuilders have seemingly been on a vendetta over the last six months, asserting themselves as the unexpected leader of the early post-pandemic recovery. After being slammed at the outset of the pandemic on fears that a coronavirus-induced recession could inflame a repeat of the Great Financial Crisis for the critical U.S. housing sector, homebuilders have roared back to life in recent months, leading the early stages of the post-pandemic recovery.

In the Hoya Capital Homebuilder Index , we track the 15 largest homebuilders, which account for roughly $100 billion in market value. Together, these 15 firms constructed approximately a quarter of total single-family homes built last year. As we discussed since the dark days of mid-March , while the " Housing Crash 2.0 " narrative was certainly a clickable headline, macroeconomic fundamentals indicated that the U.S. housing industry was likely ...