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4 Homebuilders to Consider Buying as Mortgage Rates Move Lower -Breaking

by Mike Robinson

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© Reuters. Four Homebuilders Should Consider Buying As Mortgage Rates Drop

With increased housing demand, the sector of housing is growing rapidly. Low mortgage rates are another reason homebuyers will continue to take advantage of to help them secure the dream houses they desire. We believe this is a good backdrop for quality homebuilder stocks Lennar (LEN), NVR (NYSE:), PulteGroup (NYSE:), and Cavco (CVCO) could be solid additions to one’s portfolio. So, let’s discuss these names.The homebuilder industry has grown significantly amid a solid housing market as the demand for new homes remains high. The record-breakingly low mortgage interest rates have allowed homebuyers to get homes at lower prices. Fox Business reports that on December 2, average mortgage interest rates fell to 2.6%, which was the lowest rate in 16 days.

In November, however, confidence among homebuilders soared beyond expectations. CNBC reports that the National Association of Home Builders/Wells Fargo Housing Market Index rose to 83 percent in November. And investors’ interest in the homebuilders is evident in the SPDR Homebuilders ETF’s (XHB) 6.6% returns over the past month. A Realtor.com forecast predicts that home sales will rise 6.6% by 2022.

So, we think it could be wise to add the following fundamentally sound homebuilder stocks to one’s portfolio now because they are well-positioned to benefit from the industry tailwinds: Lennar Corporation (NYSE:), NVR, Inc. (NVR), PulteGroup, Inc. (PHM), and Cavco Industries , Inc. (NASDAQ:).

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