August 1, 2006
A Housing Market on the Florida Rocks
Florida Rock is a big beneficiary of the housing boom and one of the “indicators” I watch to judge the health of the real estate market. Chart watchers will appreciate the classic “double top” pattern that formed in FRK over the past year and the stock’s subsequent breakdown. The really smart money exited around $55, the slightly slower folks got out around $45, and only the crazies continue to hold tight.
Related:
Taser’s Textbook Chart
Taser’s Test of Top
Chat Transcript: Have the Homebuilder Stocks Peaked? (August 23, 2005)
Cat: | Time: 10:11 am (utc+8)
August 1st, 2006 at 9:12 pm
In the latest quarterly report put out by FRK they said “residential demand is clearly on the decline.”
Locally, builders in SW FL are saying that they are simply building what they already had booked in 2005; that new home buyers are very scarce. One builder mentioned to me that he had one contract sold for ‘06 (they sold around 75 homes in ‘05) and another said he hadn’t sold any new contracts this year.
A year ago a mason contractor friend of mine had a VERY difficult time finding basic materials like concrete, cement block, etc. He used to have to place his orders weeks in advance. Today he said he can call in and get next day service. It’s incredible what a difference 1 year makes.
The housing industry is likely leading the way into a recession.
August 2nd, 2006 at 10:22 am
Todd: Thanks for your “on the ground” observations.