New housing starts crater in April

Homebuyers say no thank you [Click to view in browser](. Dear subscriber, We all knew rising lumber prices added costs to housing. Now, we’re seeing the effects. Housing starts plunged 9.5% in April as builders delayed new construction. Everything from lumber to sheetrock costs more these days. Builders aren’t too keen to pass along the price increases to customers. With the housing market already facing a supply crunch, economists worry that without more housing supply, already surging prices will continue. Homebuilder stocks pulled back in the last week after soaring to all-time highs. The iShares US Home Construction ETF ITB clearly highlights this shift. An ongoing challenge construction companies face is finding labor. Both skilled and unskilled positions remain unfilled, forcing some to turn down contracts. Economists often look to housing as a key indicator of economic growth due to the number of jobs created. When we compare the numbers to the prior year, things certainly look much better. Housing starts grew 67.3% in April year over year. Even when the Fed scales back its bond purchases later this year, it will take a marked increase in interest rates to temper demand. In reality, the issues the housing market faces will likely persist through 2022 and possibly into 2023. Our hot take Don’t assume that homebuilders benefit from the bubble. They’re faced with critical decisions regarding how much to pay for supply and labor and whether to pass those costs along to customers. We see that reflected in the low price-to-earnings ratios (P/E) in many of these names. Chances are, expenses will rise for them in the coming year, normalizing their P/E ratios. But this is just our take on the topic. Check out some of the thoughts and opinions from our publishers on this and other alternative investment topics. [Dollar Debasement Makes Gold and Silver Shine]( [Read More]( [Lesson Learned: Teacher Loses Life Savings To Elon Musk Bitcoin Scam]( The full article can be found on Barchart.com [Read More]( [This company is targeting the year’s hottest healthcare trends]( Global cannabis-based pharmaceuticals are expected to reach record highs this year. This company will be at the forefront [Click here to read more.]( Sponsored [Existing Home Inventory Might Have Bottomed]( I'm gathering existing home data for many local markets, and I'm watching inventory very closely this year. As I noted in Some thoughts on Housing Inventory [Read More]( [Stimulating the housing market is psychotic]( I’ve been saying this for a few weeks now, and maybe the Fed simply sees something that the rest of us don’t, but existing home prices jumping 20% in a year doesn’t quite scream S.O.S. to me. It doesn’t seem to require a relentless stream of billions of dollars in asset purchases. [Read More]( [Could this change the way you invest forever?]( Click to learn more about our "All In" buy alert. [Click here to read more.]( Sponsored [This company is on its way to being a market leader in the psychedelic industry]( Be one of the first to invest in this market leader [Click here to read more.]( Sponsored You are subscribed to email updates from [InvestingChannel](. To stop receiving these emails, you may [unsubscribe]( now. InvestingChannel, Inc., P.O. Box 118 New York, NY 10018. Disclaimer: This is not investment advice. This InvestingChannel, Inc. newsletter is for information purposes only and opinion-based. Futures, forex, stock, and options trading are not appropriate for all investors. There is a substantial risk of loss associated with trading these markets. Losses can and will occur. No system or methodology has ever been developed that can ensure returns or against losses. No representation or implication is being made that using any of these methodologies or systems will generate returns or ensure against losses. Investors should be cautious about any and all investments and are advised to conduct their own due diligence prior to making any investment decisions. [Link](