RJ Hamster
Why the Housing Crisis Is an Opportunity
 Checking in on the “housing crisis”… why it’s a tailwind for homebuilders… gold has been crushing silver recently – as predicted… Louis Navellier’s price forecast… Bitcoin recently staged a 10% rally – is it back, or just a dead cat bounce?VIEW IN BROWSERThis morning’s housing report was ugly.That came from our hypergrowth expert Luke Lango last Thursday after new data showed existing home sales plunging in January.The weakness prompted the financial media to embrace the phrase “housing crisis.”Here’s one example from The Wall Street Journal:Is this characterization fair or a bit dramatic?Well, let’s let recent data decide.According to the National Association of Realtors (NAR), in January, U.S. existing-home sales cratered 8.4% from December, falling to a seasonally adjusted annual pace of just 3.91 million homes. That’s the slowest rate in over two years and the sharpest monthly drop since early 2022.The anemic rate is even more striking given the current housing market environment…According to UPI, mortgage rates have eased compared to a year ago – the average 30-year fixed rate sat around 6.1% in January, down from roughly 6.9% in early 2025.Normally, such a drop would boost demand – yet sales still collapsed.Lingering stratospheric home prices help explain the lack of buying interest. To help illustrate this, below, I’ll show you the Case-Shiller U.S. National Home Price Index. It tracks changes in the value of residential single-family homes across the U.S.As you can see, between March 2020 and November of last year, it surged more than 50%.And what’s happened since last fall?According to the NAR, the median existing home price rose about 0.9% in January year-over-year to ~$396,800.Now, this has prompted some commentators to use another word beyond “crisis” – the “B” word – bubble.Although many would-be homebuyers would love for this to be the case (to take advantage of lower prices after the bubble pops), I have bad news…Housing isn’t a bubble in danger of a prickingHousing is rate-sensitive, supply-constrained, and frozen by the mortgage lock-in effect. Millions of homeowners are sitting on 3% mortgages they refuse to give up.Yes, as we noted above, existing home sales plunged 8.4% in January. But this isn’t a classic crash setup.Inventory remains historically tight. A balanced market typically carries a 5 – 6 month supply. Today, the market has a 3 – 4 month supply.Plus, there’s another important bubble buffer: pent-up demand. Millions of would-be buyers have been sidelined by affordability constraints and tight inventory. If prices were to fall meaningfully, that demand wouldn’t disappear – it would likely rush in, creating a natural floor under home values.Zillow’s December forecast illustrates this. It projects existing home sales rising to roughly 4.26 million in 2026 – a 4.3% increase from 2025 – as improving affordability begins to coax sidelined buyers back into the market.So, no, the market isn’t collapsing. It’s just stuck.But while that’s crushing existing home sales, it’s also creating a very investable knock-on effect…Recommended LinkIs 2026 the year of the humanoid robot?As China celebrated the Lunar New Year, the festivities broadcasted dancing humanoid robots from multiple companies – further proving Elon Musk’s claims that China is Tesla’s biggest competitor in this sector. After this display, will Elon feel the pressure to ignite mass production of the Optimus robot starting sooner rather than later? Now is the time to get positioned… and Luke Lango found a backdoor play. Click here for the name and ticker before this story breaks wide open.New home construction must pick up the slack – which puts the homebuilders trade back in the spotlightBrian Hunt has been all over this trade. Let’s jump to his free newsletter Money & Megatrends from last week:Existing home sales have stalled because current homeowners have low mortgage rates they don’t want to lose after selling. This dynamic has ‘frozen’ many housing markets…This situation brought doom upon the housing trade in 2025… But this trade is off to a great start since my original note back in November 2025.To Brian’s point, as I write, the homebuilder Toll Brothers (TOL) is hitting a new 52-week high, and PulteGroup (PHM) set a fresh one last Friday – a sign that investors are increasingly treating the “housing crisis” as a construction opportunity, not a collapse.As you can see below, these two housing giants are up 22% on the year while the S&P is essentially flat.Better still, the homebuilding forecast is growing increasingly bullish.Here’s MarketWatch from this morning, highlighting new data from the Commerce Department:Building permits, a sign of future construction, rose 4.3% to a 1.45 million rate in December. That’s higher than the 1.40 million rate expected by Wall Street and is also a sign of momentum, economists said.The average investor isn’t tracking this today, so we expect plenty of additional gains.If you want to add exposure in your portfolio, the simple, one-click way to invest is through ITB, the iShares U.S. Home Construction ETF. It holds major housing heavyweights, including D.R. Horton, Lennar, NVR, and PulteGroup, along with key suppliers tied to construction demand.ITB has been crushing the S&P 500 so far in 2026 – up almost 18% on the year – exactly what you’d expect if housing is frozen on the resale side…but still alive (and profitable) on the new-build side.We’ll keep tracking this and will report back.As expected, gold has been crushing silver recentlyIn our January 15 Digest, we highlighted the performance of gold and silver.By analyzing the gold-to-silver ratio – a long-standing measure of relative value between the two metals – we argued that silver’s explosive move had pushed the gold-to-silver ratio to extremes that favored gold’s outperformance going forward.From that Digest:Practically speaking, silver has gone from undervalued to relatively expensive versus gold in a very short period.From here, history argues that gold is more likely to outperform silver as the ratio works its way back toward equilibrium.The smarter relative bet is shifting back toward gold.Sure enough, as you can see below, since that Digest, gold has climbed 5% while silver has taken a 21% haircut.Despite this golden outperformance, we believe even higher prices are ahead for the yellow metal – as does legendary investor Louis Navellier.Let’s go to Louis’s latest issue of Accelerated Profits:[Gold’s price] should continue to meander higher throughout this year, with Yardeni Research predicting gold will hit $6,000 per ounce. Gold currently sits just below $5,000 per ounce…Deflation, economic uncertainty, global central bank purchases, potential currency devaluations and the collapse in cryptocurrencies are all factors driving gold prices higher. But really, what it all boils down to is that there is a lack of alternatives to gold.Now, if gold at $6,000 has you excited, hold on…In Louis’ issue, he highlights analysis from economist Ed Yardeni who believes even $6,000 gold could be a temporary milestone in a bigger climb. Yardeni anticipates gold will hit $10,000 by the end of the decade.In his issue, Louis walks through the case for this, but to cover more ground today, let’s just jump to his bottom line:It’s clear that investors’ two primary safe havens right now are gold and the U.S. dollar. And since interest rates in the U.S. are expected to decline over the next few years – I still anticipate multiple key interest rate cuts in 2026 – then gold is forecast to remain a popular investment.As a result, I agree with Yardeni and think gold prices could hit $10,000 per ounce by 2030. I recommend viewing any dips as a great buying opportunity.For the specific gold stocks Louis holds in Accelerated Profits, click here to learn more about joining him.How to catch a free replay of yesterday’s event with Marc ChaikinIf you’ve followed markets for any length of time, you’ve probably come across the name Marc Chaikin.Marc is a Wall Street veteran with nearly 60 years of experience. He’s also the creator of the Chaikin Money Flow indicator carried on Bloomberg and Reuters terminals, as well as a pioneer in quantitative investing long before “quant” became fashionable.Yesterday, Marc held a live evening where he walked through what he’s seeing beneath the surface of today’s market. He detailed why certain stocks are far more fragile than they appear – and how to identify the companies quietly attracting institutional buying pressure.He also demonstrated the powerful analytical tools he uses to evaluate strength, weakness, and potential turning points – they’re designed to help investors avoid holding a deteriorating stock for too long, while spotting bullish opportunities before they become obvious.With volatility picking up and leadership beginning to shift in parts of the market, Marc believes this is a critical moment for investors to pay attention.If you missed him yesterday, you can watch the full replay for free right here. You’ll also get the names of the two free stock recommendations he gave away during the event.If you want help protecting your gains, identifying emerging leaders, and understanding where money is really flowing right now, you’ll find it in Marc’s free replay.Dead cat bounce?Before we sign off, a quick update on Bitcoin.As I write on Wednesday morning, Bitcoin trades around $67,500 – a 46% collapse from its October high of just over $124,000.As we dove into last week, our blockchain expert, Luke Lango has advised crypto investors that Bitcoin’s fourth boom cycle is over, and we’ve most likely entered the fourth bust.But last week, Bitcoin briefly popped nearly 10%.What are we to make of that strength? Is it a recovery rally that has Luke rethinking his earlier analysis or just a dead cat bounce?Let’s go to his weekend update:To the untrained eye, it looks like a recovery. To the “permabulls,” it’s the start of a “V-shaped” recovery back to $100k.But we are realists. This week’s price action looks like a classic “dead cat bounce.”While the numbers on the screen are green, Bitcoin has failed to retake a single major technical level that would signal a trend reversal. It is still below all the major levels we’re watching which could signal resumption of the bull cycle.Until that changes, our outlook remains unchanged: The path of least resistance is lower.To be clear, Luke remains a long-term Bitcoin bull and is eyeing a 2027 recovery.But with the prospect of Bitcoin bottoming around $40,000 in this current bear market, he’s urging investors to remain in defensive mode today – even trimming speculative altcoins to free up “dry powder” for the eventual bull market.Just a heads-up if you’ve been wondering how to interpret the recent crypto bounce.We’ll keep you updated on all these stories here in the Digest.Have a good evening,Jeff Remsburg |
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