I’ve posted a few thoughts on the Bailout and thought I would post a few experts thoughts on exactly how this is going to affect the housing market. The first comment is by an analyst that follows and researches the housing market while the second comment is from a housing market insider that works in the industy.
Home Builders Have Mixed Views on Bailout
Will the bailout help home builders whose business has been gutted by falling values?
Paul Puryear, a home-building analyst at Raymond James & Associates, says yes. Monday, he upgraded his ratings on five builders – Lennar Corp., Centex Corp., Pulte, Toll Brothers Inc. and Ryland Group Inc. – saying the bailout is likely to put a floor on home prices by injecting liquidity into the mortgage market and restoring consumer confidence.
“You’ve got the entire United States government focused on fixing housing,” Mr. Puryear says. “It’s not a good time to bet against that effort.”
But Lennar Corp. CEO Stuart Miller, which reported its third quarter results Tuesday, didn’t sound convinced.
“The current stopgap measures to aid hard-hit financial companies will be repeatedly frustrated by falling home prices and the securities that back them,” Miller told analysts and inventors during a conference call. “Any meaningful solution to the credit crisis will necessitate a simultaneous stabilization of the housing market.”
Source: The Wall Street Journal, Michael Corkery (09/24/2008)
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