The good news continues rolling in for home builders, who hope they’ve hit bottom and are in recovery mode. But, as we’ve told you before, headwinds remain for the beleaguered sector.
Wednesday, Bank of America Merrill Lynch started seven builders with a “buy†rating, a bullish view based “on an expectation of volume growth in 2010 driven by improving economic conditions, which should more than offset any drag from the fading out of government stimulus programs.â€
The “buy†names include DR Horton, Hovnanian, KB Home, Lennar and Pulte, the nation’s largest builder. (Luxury developer Toll Bros. came in at underperform.)
Meanwhile, U.S. home construction rose during January as builders recovered from a bout of bad weather. Housing starts climbed 2.8% to a seasonally adjusted 591,000 annual rate compared to the prior month, according to the Commerce Department. The pace of 591,000 was the strongest since July 2009.
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