This is a great article and mentions some good short/put candidates for the second phase of the real estate meltdown beyond just the homebuilders who have already dropped big time.
However, I still believe the homebuilders have a LOT further to fall in the next couple years so they continue to be the ideal place to put your money in my opinion. There is clearly no better way to profit from the real estate crash than shorts/puts on real estate related stocks (other than obviously sell your house if you haven’t already done so.)
The problem with shorts and puts is that they can rally and turn on you.
“The latest rally in GM from roughly $18 to $29+ is explainable as well. There were simply too many people betting too heavily against GM (via put options expiring in 2007), and now they are taking those bets off realizing they were wrong. Unwinding of massive numbers of GM puts creates an underlying bid and GM rallied.” From Mish’s Blog
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