iShares US Home Construction ETF

ITB

Valor de mercado US$ 2,41 bi

Housing affordability has sharply deteriorated, with median income well below what's needed for the median home price. Rising interest rates and increased use of mortgage buydowns, especially temporary ones, pose mounting risks for both consumers and homebuilders.

Surging interest rates are pressuring the housing sector, with 30-year government bond yields hitting 5.6%, their highest since 2002. Housing ETFs like XHB and ITB have underperformed the S&P 500 but have not experienced severe sell-offs, suggesting some resilience despite macro headwinds.

REITs are refusing to break despite another rate shock: the 10-Year Treasury reached 5%, yet REITs remain higher by roughly 7% in 2026 as the once-dominant rate correlation weakens further. Solid fundamentals are increasingly doing the heavy lifting, with healthy property-level cash flows, improving earnings visibility, strong dividend coverage, and better balance sheets helping REITs absorb the rate shock. Cooling supply increasingly reinforces fundamentals: excluding Data Centers, REIT development pipelines are roughly 40% below their 2022 peak and 2019 levels; Data Centers remain the exception at seven times 2019 levels.

The Nasdaq 100 carved out a fresh intraday record by midday Tuesday as the artificial intelligence trade powered ahead.

The Fed's likely rate hike could create opportunities and risks across ETFs, with value, technology and energy in focus while homebuilders, leisure and small-caps face pressure.

Let's start with a fun fact: 56% of U.S. households can only afford a home below $300,000, versus a $434,100 median home price. Affordability remains a problem, and I don't see a permanent fix in the near term.

National Association of Home Builders President and CEO Jim Tobin discusses the historically rough housing market on 'Maria Bartiromo's Wall Street.'

U.S. equity markets pulled back from record highs this week as long-term Treasury yields remained elevated, with renewed fiscal concerns after federal debt crossed $40T. Oil prices extended their rebound as stalled Iran negotiations and severely depressed Strait of Hormuz tanker traffic kept geopolitical risk elevated, pushing WTI crude another 5% higher to nearly $87/barrel. Housing data remained soft as starts, pending sales, and builder sentiment stayed depressed amid mortgage rates near 6.7%, but weak construction continued to reinforce the underlying housing shortage.

Home-builder stocks are cheap, but it's not easy to time a rebound in the depressed housing market.

Builders' slower construction could help their margins if they don't have to offer discounts or incentives to boost sales.