In this article, we discuss the 11 best housing stocks of 2021. If you want to skip our detailed analysis of the housing industry, go directly to the 5 Best Housing Stocks of 2021.
The housing market is on fire. This statement seems ubiquitous nowadays. Indeed, on July 27, S&P CoreLogic reported a 16.6% increase in the U.S. housing prices in May, higher than the 14.8% increase reported for April. According to S&P CoreLogic, this growth is broad-based; that is, the housing markets in the 20 U.S. cities they are tracking have risen and the 18 of which are at the highest they have ever been. Business Insider notes that the inadequate supply of housing is driving up the prices as the demand continues to recover with the reopening. Business Insider also regards the increase in construction costs as well as lack of building space as drivers of the supply shortage.
As the supply bottlenecks coupled with high demand drive up the prices, home construction companies such as D.R. Horton, Inc. (NYSE: DHI) and Lennar Corporation (NYSE: LEN) benefitted from this market. Both companies have returned around 45% to investors over the course of the past year. Also, the two largest home improvement retailers The Home Depot, Inc. (NYSE: HD) and Lowe’s Companies, Inc. (NYSE: LOW) have benefitted from this high demand as people are not only shopping for newer homes but also for better quality of life at home as the work from home has changed the way people envision their homes.
Regarding the…
