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A Housing Contrarian Who Was Ahead of the 2008 Curve

Barry Ritholtz

(Bloomberg Opinion) -- What do you do when the head of product management tells you to turn bullish or your job is at risk? Or when a major home building company, Toll Brothers Inc., names the recent lows after you (“the Zelman bottom”)? Or if most of the sales staff does not appreciate your negative contrarianism?

If you were Ivy Zelman, housing analyst at Credit Suisse First Boston — and you just happened to be right about your forecast of an impending housing and mortgage collapse that will be part of the Great Financial Crisis — you double down.

We discuss in this week’s Masters in Business podcast how Zelman, who warned of write-downs by home builders before the stocks fell 40 percent, responded by writing a new research piece in December 2006 entitled, “10 Reasons to sell housing stocks.” 

Housing began to collapse on cue. So much for the  Zelman bottom.

The sales staff might not have appreciated her negativity, but her clients — including subprime bears John Paulson, Steve Eisman (depicted in “The Big Short”) and Danny Moses of FrontPoint Partners — appreciated her actionable perspectives.

Today, Ivy Zelman is co-founder and chief executive of Zelman & Associates. She is an equity research analyst covering real estate and housing-related industries and is best known for warning about the housing crash and financial crisis.

Her contrarian calls on housing have been astute and well-timed, in large part due to her network of private industry professionals from home building companies, brokers, mortgage underwriters and suppliers.

Her favorite books are here. A transcript of our conversation is available here.

You can stream or download the full conversation, including the podcast extras on Apple iTunes, Bloomberg, Overcast, and Stitcher. Earlier podcasts can all be found at iTunes, Stitcher, Overcast, and Bloomberg.

Next week I’ll be speaking to Don Felder, lead guitarist for the Eagles.

To contact the author of this story: Barry Ritholtz at

To contact the editor responsible for this story: Jonathan Landman at

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Barry Ritholtz is a Bloomberg Opinion columnist. He founded Ritholtz Wealth Management and was chief executive and director of equity research at FusionIQ, a quantitative research firm. He is the author of “Bailout Nation.”

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