Photo: Goldman Sachs
A note out from Goldman’s Joshua Pollard tells investors to fade the rally in homebuilders.While homebuilder stocks have outperformed the market by 1.5% in the past three months, Pollard says stocks are getting ahead of the recovery. Actually housing data has been lackluster this winter, and indicators like new mortgage applications point to a low sales in the spring.
Goldman has reduced its target for 2012 new home sales to 425k from 485k.
The bank predicts 10-15% new home sales growth in 2011 and 2012, well below consensus estimates for 20% growth in 2012.
Low mortgage applications in January predict low mortgage applications in April (and last year's jump was based on housing stimulus)