Don't Invest In Housing Stocks
1. Raw material costs
There are a lot of materials that go into building a home that the builder has no control over.
2. Land costs
Land in hot areas is getting more and more expensive.
3. Labor costs and shortage of craftsman
There is always a labor shortage.
4. No control over mortgage rates
The mortgage rates determine the number of buyers that can actually afford to buy a home.
5. Are they building in a hot area?
How quickly can an area turn cold?
6. Difficult to maintain and scale a housing business
Must have a lot of capital to go out and buy more land and construct new homes.
7. Poor industry track record
Lots of businesses have not made it.
8. Lawsuits waiting to happen
Anyone can sue for a poorly built home.
9. Buyers remorse
Home buyers can cancel their order.
10. One reason to invest in the market
There is a housing shortage in America.