Housing rebounds without job gains
Rising home prices and sales usually follow increased employment, but that's not what's happening now.
By Jim Cramer, TheStreet
When you get housing turning -- as we saw Thursday with the most stubborn markets in the country, Sarasota-Bradenton and Palm Beach, up 9 and 8%, when you get Hamptons rentals going up huge (thank you Bloomberg for that), when you get California mortgage foreclosures down gigantically, you begin to get a picture that the so-called shadow inventory is just one more canard that's being knocked down as we talk.
This rebound isn't supposed to be happening. It isn't supposed to happen until employment turns. That's just a given. But it's shifting and it's pretty stark. It's driving a lot of the retailers that sell home-related products (Home Depot (HD), TJX (TJX), Big Lots (BIG), Kohl's (KSS), Bed Bath & Beyond (BBBY), Macy's (M), Sears (SHLD)).
When analysts' models are wrong and something turns when it's not expected, investors who bet that stocks will fall get caught. These days, short sellers looking to capitalize on the weak employment situation are betting on declines in retailers, housing REITs and banks with big home exposure.
Throughout this period, we have had nothing but endlessly downbeat news about housing. Anytime there is something good, it's ignored. Anytime there is something bad, it is emphasized.
To me, a guy who just looks at the numbers, housing bottomed last July. It is only now that home sales and prices are starting to improve.
Maybe the housing market no long depends on employment. Housing prices crashed while we were still getting great employment news. So it's realistic to presume that we could see improvement in a leading indicator (housing) without a gain in a lagging one (employment).
Stranger things have happened.
At the time of publication, Cramer was long Home Depot.
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