Homebuilder Rally Turns to Rout on Signs of Fading Housing Boom

Homebuilder Rally Turns to Rout on Signs of Fading Housing Boom

(Bloomberg) -- The outlook for U.S. homebuilder stocks is darkening as investors see slowing home sales and skyrocketing prices as a sign the housing boom may fade.

An S&P index of 16 builders had surged nearly 250% between March 2020 and early May as the housing market proved one of the rare bright spots in an economy paralyzed by the pandemic. But the index has slumped about 12% since then, with industry bellwethers DR Horton Inc. and PulteGroup Inc. among the 11 companies that saw double-digit declines.