NEW YORK ( TheStreet) -- While there have been some mixed signs in the housing market, TheStreet's Jim Cramer explains to Debra Borchardt that there's one data point that tells the whole story.
Home prices are up, and Toll Brothers (TOL) said it's selling houses at the high end of the range. But Cramer said that as long as mortgage applications continue to trend lower, so will housing.
He added that the homebuilders have been too optimistic and that a glut of housing inventory could be beginning to form.
Falling mortgage applications is a sign that consumers aren't buying housing and feel that they've missed the boat on lower rates.Cramer went on to say that while mortgage rates are still low historically, the violent rise over the past four months has pushed a lot of consumers to the sidelines. Although housing has been the fuel for a recovering economy, he said a whole new group of stocks could lead the way from here, Specifically, those with international exposure should do well, especially with Europe in recovery mode. Action Alerts PLUS, which Cramer co-manages as a charitable trust, has no positions in the stocks mentioned.
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