Pending Home Sales Hit Low; ETFs Aren't Out of the Woods Yet
ETF Trends - Keeping a Grip on Exchange Traded Funds (ETFs)
Homebuilder and real estate exchange traded funds (ETFs) may have been showing strong performance over the last month, but that doesn't mean our housing problem is over.
In February, pending home sales hit a new low, reports Alan Zibel for the Associated Press. The National Associated of Realtors' index fell to 84.6, down from January's 86.2. Last February, the index was at 107.6. Economists had been expecting the index would move up slightly, to 86.3.
The index began in 2001 at a reading of 100. Its previous low was 85.8, notched last August. One economist predicts that home sales will fall by another 5% to 10% before making a turnaround at the end of the year.
Homebuilder ETFs are about 2.5% lower midday, while real estate ETFs are down slightly at less than 1%:
iShares Dow Jones Real Estate (IYR), up 13.5% in the last month
iShares Cohen & Steers Realty Majors (ICF), up 15.7% in the last month
iShares Dow Jones US Home Construction (ITB), up 31.4% in the last month
SPDR S&P Homebuilders (XHB), up 26% in the last month
For full disclosure, some of Tom Lydon's clients own shares of XHB.