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KEY TOPICS DISCUSSED:
- Is it Time to Get Long? Rising rates, rising commodity input costs, rising skilled labor costs, rising supply constraints and declining volume growth in the existing market and fears of more of the same have led to significant declines since the start of the year for the broader housing sector, most notably the homebuilders. Is now the right time to be re-evaluating on the long side? We'll consider the setup over the back half of the year and headed into 2019 and detail why fundamental conditions remain asymmetric from a longer-term perspective.
- Climate Change Coming to a Shoreline Near You: The reality of climate change remains on a collision course with homeowners in low-lying areas. While not a concern today or (the day after) tomorrow, at some point down the road there will be a growing realization that homes near the water are going to be worth (much) less as their value converges toward zero amid rising sea levels. We're obviously very early here but we think it's the right time to begin asking the questions and considering the implications as most US real estate property is still financed with 30-year mortgages.
