Investment strategist calls weak housing market a ‘worrying sign’

Piper Sandler, chief investment strategist Michael Kantrowitz, joined ‘Mornings with Maria’ on Monday to discuss the weakening housing market, arguing it’s a ‘worrying sign’ of what lies ahead for the US economy further late this year.

MICHAEL KANTROWITZ: If you look at the ITB Home Builder ETF, it has significantly underperformed over the past few weeks, a few months, as interest rates have fallen. Housing inventories have a bit of a problem now that they are facing, home prices nationwide are extremely high and have been for about a year. And now we have a big increase in interest rates to add to that, which will make it harder for new buyers looking to buy their first home and borrow money. And so we would continue to avoid homebuilding stocks.

Michael Kantrowitz joins “Mornings with Maria” on April 4, 2022.

MEDIAN HOME PRICES HIT RECORD US$405,000: REPORT

And I would argue that weak housing data is your typical canary in the coal mine for a slowdown in the broader economy. And so the fact that housing stocks and I think housing data is looking in the NAHB report in the next few days for weakness that’s a canary, typical or classic canary in the coal mine. And that’s how the weaker slots go. It’s kind of a foreshadowing of what the rest of the economy will look like later this year. So it’s a bit of a bad omen to see housing weaken.

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