After a stellar 2017 in the housing sector, Hedgeye Housing sector head Josh Steiner is expecting that shine to wear off big time in 2018. Two housing stocks in particular could be at the forefront of that slowdown.
Redfin (RDFN) is currently one of Steiner’s best idea shorts while Realogy (RLGY) has gone from one of his favorite long ideas to one he’s significantly less bullish on this year.
Redfin shares were sold by insiders recently, from its CFO, its head of technology, its head of growth, and its head of real estate operations. It also saw a significant decline in its demand index in February.
Meanwhile, Realogy will likely suffer from the increasing slowdown in high-end home sales, in places like New York City, after benefiting from easy comps in 2017. Realogy shares also took a big hit following the announcement of the GOP’s tax overhaul, a major reason why Steiner took Realogy off his Best Idea long list. As Steiner says:
“They rolled out all of these SALT provisions that were very detrimental to markets that were core to Realogy’s owned business,” Steiner says in the clip above. “The outlook for Manhattan is not good. The outlook for luxury is not good. These are all in the heart of Realogy’s operating environment.”
Watch the above clip for more.