The latest data from the S&P Case-Shiller Home Price index came out earlier this week, and the results pointed to a double-digit percentage gain in home prices over the past year. Yet despite some encouraging signs, there are still several reasons to worry about the staying-power of the recent recovery in the housing market.
In the following video, Fool contributor Dan Caplinger goes through some of the troubling parts of the latest Case-Shiller report. Dan notes that gains weren't spread uniformly across the country, and that some of those cities are getting close to their mid-2000s peak levels, suggesting limited upside. Moreover, rising mortgage rates could prove problematic in sustaining further price gains. Dan concludes with some discussion of stocks affected by the housing market and their prospects going forward.
Big banks have relied on the housing market, and with banks still trading at deep discounts to their historic norms, investors everywhere are wondering if this is the new normal, or if bank stocks such as JPMorgan Chase are a screaming buy today. The answer depends on the company, so to help figure out whether JPMorgan is a buy today, check out The Motley Fool's premium research report on the company. Click here now for instant access!
The article 3 Reasons to Doubt Housing's Recovery originally appeared on Fool.com.
Fool contributor Dan Caplinger owns warrants on JPMorgan Chase and Wells Fargo. The Motley Fool recommends Wells Fargo and owns shares of JPMorgan Chase and Wells Fargo. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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