Goldman, Blackstone turn bullish on housing

TRD NEW YORK /
Dec.December 29, 2011 03:10 PM

alternate
text
Goldman Sachs, the Blackstone Group and several other notable investors have turned bullish on the U.S. housing market, the Wall Street Journal reported, buying up shares of home building companies, like Pulte Group, Beazer Homes and Hovnanian Enterprises. Those stocks are up 30 percent since the end of the third quarter, according to Dow Jones, far outpacing the 10.5 percent increase recorded by the Standard & Poor’s 500.

In a recent report, Goldman said it expects home prices to decline 3 percent next year, before gaining 30 percent — not taking inflation into account — through 2022. Meanwhile, a Blackstone hedge fund said it is banking on the fact that “the inventory picture has cleared meaningfully.” Inventory fell 5.8 percent in November to its lowest level in 2005.

Investors also believe that pent-up housing demand will be converted into home sales, as record-low mortgage rates ADD LINK and improving affordability finally convince hesitant buyers to take the plunge and make a purchase.

Still, the Journal noted that many pessimists still lurk among investors. Bears say sustained high unemployment and the backlog of foreclosed homes waiting to be unleashed on the market will limit growth for years. [WSJ]


Related Articles

arrow_forward_ios
Bernie Sanders (Credit: Getty Images)

Bernie Sanders throws support behind New York rent-suspension bill

The 30-year fixed rate dropped to 3.5 percent this week (Credit: iStock)

Mortgage rates fall, but who’s buying?

Gov. Andrew Cuomo (Credit: Bennett Raglin/Getty Images)

NY regulators lay out specifics of homeowner mortgage break

Real estate brokers across the country have been adding standardized coronavirus-related legal language and addendums to help buyers manage risk.

The coronavirus clause is now a thing in resi deals

FHFA Director Mark Calabria (Photo by Zach Gibson/Getty Images)

Fannie, Freddie offer multifamily landlords a break — strings attached

Governor Andrew Cuomo (Credit: Getty Images, iStock, and Pixabay)

Cuomo’s executive order tells banks to give homeowners a break

Lennar’s Stuart Miller

Lennar says homes are still selling despite coronavirus

U.S. housing starts and permits are up from last year, but experts say the coronavirus could hit construction hard. (Credit: iStock)

Housing starts were up in February. But it’s about to get rocky

arrow_forward_ios
Loading...