Housing Stocks Are On The Rise Today: What's Going On?

Shares of housing stocks including NVR Inc. NVR and D.R. Horton Inc. DHI traded higher on Monday, likely driven by a better-than-expected report on U.S. new home sales for December.

What To Know: According to Reuters, the U.S. Commerce Department reported new home sales increased 3.6% to a seasonally adjusted annual rate of 698,000 units in December, exceeding economists’ expectations of 675,000 units. This marked a 6.7% year-over-year increase and contributed to a total of 683,000 new homes sold in 2024, a 2.5% gain from 2023. The median new home price rose 2.1% from the prior year to $427,000, although rising inventory appears to be tempering price growth.

This data potentially indicates sustained momentum in the housing market despite high mortgage rates, which have constrained activity overall. Builders are responding by constructing smaller, more affordable homes to attract buyers, while the inventory of new homes reached 494,000 units in December—the highest level since 2007. Notably, 118,000 homes were completed, the most since 2009.

Both companies operate as real estate investment trusts (REITs) focused on essential infrastructure, such as cell towers, which benefit indirectly from increased housing development and connectivity demands in growing residential areas. Rising demand for new housing may also spur further investments in telecommunications infrastructure, fueling optimism among investors about these stocks’ long-term growth potential.

Price Action: NVR shares closed up 2.22% at $8,382.63 and D.R. Horton shares closed up 3.05% at $147.26 at the time of publication Monday, according to Benzinga Pro.

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