Bank of America Corp (BAC) Surges on Better-Than-Expected Housing Data

In addition, many of the homes being purchased now are strictly for investment, fueled by a demand from hedge funds. A recent Washington Post article noted that “institutional investors — who in some cases are bidding on hundreds of homes a day — account for as much as 70 percent of sales in some Florida markets. Over the past two years, analysts say, they also have accounted for a majority of purchases in other parts of the country where housing prices are rebounding sharply.” The fear is that the still-nascent housing recovery will stall once these buyers have had their fill.

But either way, for the time being at least, it’s clear that investors are celebrating the direction of the housing market. And for good reason, as my colleague Morgan Housel has noted, “Housing itself won’t drive a strong recovery, but it’s important enough that there hasn’t been a strong economy without a strong housing market in modern history.”

The article Bank of America Surges on Better-Than-Expected Housing Data originally appeared on Fool.com and is written by John Maxfield.

John Maxfield owns shares of Bank of America. The Motley Fool recommends Bank of America. The Motley Fool owns shares of Bank of America.

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