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So, the spring home selling season did not save public homebuilders....how about hopes for grabbing market share from smaller builders? Several bullish analysts (I wonder how many remain?) have touted the prospects of muscling smaller builders out of their markets as a great way for larger, public homebuilders to maintain revenues and profitability...and more importantly, provide reasons for buying the stocks of these companies. Sounds logical, especially when you consider that a slowing housing economy cannot possibly support the number of builders that are out there. Well, BuilderOnline reports on the other side of the story. Back in May, this industry rag published a very educational article: "Standing Firm: To compete against national builders, smaller companies are diversifying their product mix and cozying up to developers." If you are interested in learning more about the dynamics of the housing market, this article makes for a good read. Some of the more interesting points I got out of it are:
As we wait for another edict from the Fed, be careful out there...! |