Real estate and homebuilding stock have been remarkably strong lately. The very long-term patterns suggest that prices are very elevated right now, but in the short term, they have been astonishingly robust, with the home construction fund ITB at record highs.
The real estate fund IYR isn’t at record highs (this chart is zoomed in to recent history) but its ascent has been more steadfast and relentless than most other real estate funds.
The other homebuilders fund, XHB, is likewise at lifetime highs. The trendline shown here, as with the one for ITB above, it for the lifetime of the fund. In other words, we are very, very lofty. It seems that the prospect of slightly lower interest rates makes folks thinks that there’s going to be a stampede to buy new houses.
