I disagree. KBH just bought some land in Moraga, California and plans to build 36 homes. This is another example of a profitable venture in a very hot market. Rising interest rates could impact KBH's margins, mainly their borrowing costs. Demand is very high in areas like Moraga. The interest rate doesn't matter for many of the buyers and there are way more buyers than houses to buy. So, if you eliminate some of the poor buyers who cannot afford to buy you still have all the remainders. Also, when KBH sells a house they often carry paper and benefit from higher rates like a bank. Higher interest rates are a headwind but getting financing currently is easy especially for a company like KBH so they pay low rates. What woild hurt would be a glut of inventory, huge stock market selloff or a much tighter credit market all in my opinion. Your thoughts?
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