Kass: A House Divided Against Itself
This column originally appeared on Real Money Pro at 8:38 a.m. EST on Jan. 28.
NEW YORK ( Real Money) --
We're beginning to hear noises that we've reached a major turning point in the housing market -- and that, with interest rates so low, this is a rare opportunity to buy. But are such observations on target?
It would be comforting if they were. Yet the unfortunate truth is that the tea leaves don't clearly suggest any particular path for prices, either up or down....The bottom line for potential home buyers or sellers is probably this: Don't do anything dramatic or difficult. There is too much uncertainty to justify any aggressive speculative moves right now. If you have personal reasons for getting into or out of the housing market, go ahead. Otherwise, don't stay up worrying about home prices any more than you do about stock prices. I can't offer any clearer picture, and I don't see a solid basis for anyone else to do so, either. -- Dr. Robert Shiller, " A New Housing Boom? Don't Count on It," The New York Times (Jan. 26, 2013)
- A real estate recovery is under way (led by multi-family starts), but a full-blown housing recovery is probably a few years away.
- A 2013-2014 recovery in the housing market (and for the consumer in general) will be impeded by the fiscal drag of higher individual tax rates and lower government spending and possibly by higher interest rates.
- Construction activity represents a relatively small fraction of GDP -- its aggregate impact on domestic economic growth is being overstated by many.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV