Here's Why Investors Should Be Worried About Housing

One of the brightest sectors in the economy over the last few years has been homebuilding.

Many of the nation's largest builders have become increasing confident in the recovery, and their operating results provide reason for optimism. KB Home (KBH -1.05%), PulteGroup (PHM -0.52%), and D.R. Horton (DHI -1.51%) have all reported improving trends in sales and order volumes since the depth of the housing crisis. Recently, however, some of these gains are starting to erode. New orders at both KB Home and PulteGroup fell in the most recent quarter, while investors are waiting to hear updated results from D.R. Horton, the nation's biggest homebuilder.

In the video below, Motley Fool contributor John Maxfield discusses why many analysts are fearing that the recovery may be stalling.