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Scarce land could blunt recovery for U.S. homebuilders
A resurgent U.S. housing market has created an unforeseen land shortage that could take the shine off an otherwise promising year for homebuilders. To keep up with demand, builders who neglected to buy land during the downturn must now pay top dollar for prized city-center locations. Their profit margins are likely to be squeezed this year, even as house prices rise. "Builders waited so long to buy land that, when the recovery happened, it was very strong and they got caught short," said Tobias Welo, a portfolio manager at Fidelity Investments. The quickest solution for the big players, according to some analysts ... (full story)