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<p>In May of 2005, we introduced the InvesTech Housing [Bubble] Barometer to keep a real-time pulse on the rapidly expanding housing bubble.&nbsp; This leading housing indicator was designed to track the stocks with the greatest sensitivity to the housing market, such as homebuilders and mortgage financing companies.&nbsp; Our barometer peaked almost immediately after its debut, and just a few months before the top and subsequent six-year decline in housing prices.</p>
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<p>Following the onset of the COVID-19 pandemic, the Federal Reserve slashed interest rates to zero and pumped trillions of dollars into the economy, which then ignited a frenzy in the housing market for the second time in as many decades. &nbsp;Homebuyer demand soared, as did housing prices, which grew by a record 20% from the year before! &nbsp;Unsurprisingly, our Housing [Bubble] Bellwether Barometer skyrocketed to an all-time high for the first time since the height of the housing bubble 15 years earlier. &nbsp;Going forward, a reversal in this leading indicator will likely signal that the housing bubble is beginning to unwind, just as it did in the mid-2000s…</p>
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