Real Estate Names Crumble Amid Macro Woes
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Real Estate Names Crumble Amid Macro Woes

With rising rates being the dominant theme in 2022, major housing names have faced the heat. Potential homebuyers are shying away from the market and it would probably take a combination of falling prices and a scale-back in rates to pique their interest.

Further, today, while new home sales came in 5.8% higher than the prior month, the numbers still indicated a 15.3% decline from year-ago levels.

Redfin (RDFN) noted that home buying by investors declined by 30% over the prior year during the third quarter and the company has already guided for a soft Q4. Consequently, RDFN shares have tanked 89% over the past year and short interest in the stock still remains high at about 19%.

RDFN did witness an uptick in demand in December but it still remains a far cry from peak levels.

A similar impact in the share price is playing out for Anywhere Real Estate (HOUS), RE/MAX Holdings (RMAX), and Compass (COMP). Shares of the three names have plummeted 63%, 39.6%, and 76% respectively over the past year.

Amid macro challenges, RE/MAX witnessed lower home sales in November and Compass anticipates a fall of more than 20% in its top line for the fourth quarter.

 The Real estate Select Sector SPDR ETF (XLRE) too has shed 26.1% over the past year.

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