Rising Home Prices A Tailwind For Home-Improvement Retailers

Despite lower housing turnover in December, the latest home sales report still has some positive signs for home-improvement retailers. DA Davidson analyst Michael Baker says in a research note that home prices are historically a more significant driver of sales than home turnover for retailers like Home Depot and Lowe’s. Home prices increased 4.4% from a year ago on average in December, the sixth-straight month of year-on-year increases and an acceleration on a year-over-year basis, according to DA Davidson. Firmer home prices will likely help those retailers’ sales. Baker says the report could be an early sign of nearing an inflection point for home-related stocks. Home Depot rises 0.8%, while Lowe’s gains 0.9%.

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