brokers suggest for sell

Recently, many brokers suggest for sell this stock as:

The company?s US brick and tile plants were operating between 15 per cent and 30 per cent of capacity, with an EBIT loss of $49 million. It reported underlying NPAT of $ 68 million in the first half of 2010, down 9 per cent on the previous corresponding period. Boral looks expensive compared to its peers.

Yesterday , the Australian Bureau of Statistics advised that Mortgage approvals plunged to a nine year low. Further, they provided a chart, showing a link between mortgage approvals (demand) and house prices.

The chart shows that House Price Index is still at a record high and closely follows mortgage approvals. Hence, we believe that house prices will fall significantly over the next 3-6 months.

When the housing market started to show signs of weakness in 2007/08, Wayne Swan opened up our property market to foreign buyers. It was those foreign buyers, using cash or loans from their home countries that propped up our house prices, causing a large divergence between mortgage approvals and house prices. Some agents were reporting as many as 30% of purchases were to foreign buyers, which as you can see, helps counteract a fall in house prices from the shortfall of mortgage approvals.

In late April and under immense pressure from the public, the government reversed their decision on streamlining foreign property purchases, effectively turning off the tap overnight. Housing statistics take a while to come through the pipeline, and potentially we could be in for quite a shock soon. Already we are witnessing rapidly falling clearance rates

The auction clearance rate in Melbourne had been running in the vicinity of 85 percent, but according to revised numbers from the REIV, it hit at low of 72 percent last weekend. Of the reported 808 auctions this weekend, a 70 percent auction clearance rate was obtained. This result is reported to be the worst for two years.

In December 2009, figures from the Reserve Bank of Australia showed total household debt as a percentage of disposable income at 155.8%. Of that, 138.2% or the vast majority of it is housing debt due much in part of Australia?s huge housing bubble.

Boral is leveraged to the housing market. We believe that rising interest rates in Australia and a weakening global economy will hurt BLD's share price in the short-term. Sell.

What is your view about it?