3 Housing Areas to Watch
We're optimistic about housing demand, and think investors should keep their eyes on undervalued wood product, home improvement, and homebuilding companies.
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Mentioned: Canfor Corp (CFP)
, West Fraser Timber Co.Ltd (WFT)
, PulteGroup Inc (PHM)
, Lowe's Companies Inc (LOW)
Charles Gross: Although growth in housing construction fell short of our expectations in 2016, we believe tight labor markets, rising wages, and reasonable property prices will lead to rising demand in 2017.
Over the past year, single family construction grew by roughly 10%, while multifamily construction fell by 3%. In total, construction on nearly 1.2 million properties began. In 2017, we see that pace advancing to roughly 1.3 million units, and believe construction activity will rise to 1.9 million in 2020.
Charles Gross does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.