SPDR S&P Homebuilders (ETF) (AMEX:XHB)

Homebuilders are in vogue again, but it won't last. Make a trade here and get out.

This, along with $CAT, will provide a look into the progress of the housing market as a whole. I believe the bottom has been reached and we'll start going up from here

I expect the housing market to start to recover at some point in the second half of 2012.

This is a cyclical investment which should have strong growth over the next five years.

Home price stays low for many years

Because we all know all the bad news about home builders.

IT'S the HOMEBUILDERS STUPID!!!!!

My negative opinion of this ETF may be a bit sophomoric, but this is a summary of why I give XHB the down check.

The ETF is called the S&P homebuilders ETF but a huge chunk of their holdings are not home builders such as Ethan Alan, Home Depot, Legget & Platt, Lowes, Mohawk Ind. And Sherman Williams. Related industries, retailers? Yeah sure, why not throw in a sod harvesting company, telephone company, garden gnome manufacturer and maybe a utility company?

Any housing market recovery will have a lot of latency built in. Specifically, if and when the conditions are right to start building houses on a large scale again if will take quite a while for these companies to respond and start making the big money again.

Now for the inflammatory part of the pitch, I believe that the housing market is in for a protracted period of stagnation in housing prices and new home building. Lending standards are tightening (relative to 04/05 standard practices), housing prices have briskly gone up at an unsustainable rate for too long and there is a glut of new houses on the market. I hesitate to evoke the words sub-prime and alt-A but we are not done feeling the negative effects of bad mortgage lending practices as well.

If you are trying to make CAPS points or real money hoping that you found the bottom of the housing sector decline I think you are coming to the dance, early by a few years.

this is a home buiding etf which will only go up if the economy goes up. since it looks like the economy is improving and housing number also improving the stock will only go up. i like this as a long hold

The weakest link in our road to recovery. With all the foreclosures,why will the majority of the people need to build homes? There will be plenty of empty houses and buildings. People are more concerned about saving money, getting (keeping) their jobs, and buying baby diapers, not remodeling their homes. Or adding a 6th bedroom to their house.

Only way for homebuilders to go is up!

Technical Pick.....

Do a chart on XHB and you'll see it peaked around early May....since then this index had a heavy correction - and has been consistently range bound - on a Key resistance line.

While on the downside it broke thru the equivalent support line ( to S&P 878) in the market action in the last week or so.

Typically High Beta - so should differentiate 5+ points from S&P

This is the time to jump into the housing sector. I believe that the bottom is here or is very close and the recovery will be very strong.

Things are picking back up.

Good bottom in.

OBAMA GONNA PAY MY MORTGAGE!!

YEAAAAAAA, BOY!

housing will come back in 2 to 4 years time buy low sell high

Lots of pain still to come.

Outperform based on valuation of homebuilders and a gradual recovery. Market will likely start to move before the real data comes out in official statistics.

We are closing in on the bottom in the cycle for the homebuilders. Given the violent swings in the market, the prudent thing is to use 1/4 tranches (instead of 1/3) when initiating or adding to positions.