Home Depot CEO Cautions on US Housing Optimism

Home Depot (HD) chief executive, Frank Blake, said Tuesday that housing market signals are still mixed, and warned that the growing optimism over the US housing market may be a bit premature.

From FT: “We are concerned about the accelerating rates of foreclosures, particularly in the western part of the country,” he said, noting that one out of every 54 homes in California was in foreclosure.

Mr Blake said that a slowing foreclosure rate in California during the fourth quarter had led to an improvement in regional store sales but the trend had then reversed as foreclosure rates rose again in the first quarter.

The shift “provides a cautionary note on signalling a recovery prematurely”, he said. “Before we see real improvement we believe we need to see sustainable deceleration in foreclosures.”

Blake’s comments make sense considering foreclosure filings hit a new record for the second consecutive month in April.

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