Here, Zacks Investment Reseach focuses on the home building sector, and the picture is modestly bright.
Despite a weak start this year amid equity market volatility and global concerns, the construction sector seems to have recovered on the back of strong housing fundamentals. The spring selling season in 2016 was better than last year. The springtime weather boosts construction activity and traffic trends.
Positives like an improving economy, modest wage growth, low unemployment levels, low interest rates, positive consumer confidence and a tight supply situation raise optimism about the sector’s performance for the second half of 2016.
However, a tight labor market, limited land availability and constrained mortgage environment restrict the ability of home builders to quickly respond to growing demand.