New Construction Continues to Boom

New Construction Continues to Boom

Mortgage bonds have again traveled to the top of the downward trading channel. Since we have been in this cycle for many months, the safe prediction is that they will soon find themselves back at the bottom. Stocks have continued to rebound from their recent correction. With only the 25-day moving average as a ceiling above, they have successfully climbed over the most difficult hurdles. We could soon be back to a time where stocks are again setting new all-time high records. The resilience stocks have shown in recent years is astounding.  It seems that investor confidence remains at irrational levels. Unless March’s Fed rate hike scares them away, we will likely see stocks resume their climb higher as the weeks and months move on.

 

The housing market continues to show strength, with the new construction market being the shining beacon within the industry. Given the lack of existing homes on the market, we need new homes to be built in order to keep up with demand. The housing market went a number of years without building sufficient homes following the housing market crash. With builders now back on track, the pace of construction needs to be high for the coming years.

 

With bonds still on the downward trend, we will maintain our locking bias.