Homebuilder stocks- Are they qualitatively compliant?

Salam Mufti sahab,

What is the shariah opinion on home builder stocks. I have not done any quantitative screening yet, but I want to be sure on the qualitative aspect as I understand there might be lots of interest based dealing going on in these home builder stocks. The representative companies could be Beazer Homes, Taylor Morrison, D.R.Horton etc.

Please let us know.


May Allah bless you.

When buying stocks, the first thing we must look at, is the nature of the business. Homebuilder is a company that builds private homes. This in itself would be a shariah compliant activity.
After that, one must look at other criteria such as the one you’ve mentioned, which is whether the company is dealing with interest or not, and if they are, to what extend would that be?
My advice is, if you wish to buy homebuilder stocks, then do a screening using the method mentioned on our website: https://www.islamicfinanceguru.com/investment/how-to-screen-for-halal-sharia-compliant-shares/

And Allah knows best!

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