Is Housing Bullish or Bearish? Read This.

Did you know there is an ETF (electronically traded fund) for publicly traded home builders?   It is called I Shares US Home Construction ETF, symbol ITB.

This ETF contains shares of KB Homes, NVR Homes, Pulte Homes, DR Horton, Toll Brothers and Lennar.  All well known home building companies.  Buy one share of the EFT, and you own a little of all of them, and can trade in and out anytime, any day.

Short interest is the highest ever in this ETF, meaning, many folks think publicly traded home building companies are over-priced right now.  Is that a bearish sign or a bullish sign ?

Here is how much some of them have gone up just since January 1, 2012

KB Homes  6.95 to 13.10 ..   up 90 %  (where else could you have made so much profit so quick ?)

Pulte Homes  6.47 to 9.68           up  almost 50 %

DR Horton  12.89 to 16.37         up almost 30%

Lennar Homes   20.00 to 27.00  up almost 35 %

Toll Brothers  20.83  to 24.83  up almost 20 %

With CD’s paying half of one percent, who would have thought that you could have made so much, so quickly, in home building stocks ?  Which have been depressed for many months since “people are not buying new homes” ---  or are they?   Something is driving this, is it irrational exuberance?

Wish I had had my entire investments in KB Homes this year!!  Who would have predicted that kind of run up?

Please post your thoughts, comments and ideas on the future potential of these stocks.