If one believe that the stocks of home builders is a canary in the cage, then based on this article, https://seekingalpha.com/article/4167864-homebuilder-stocks-overvalued-leveraged-going-lower?page=2#, we are about to make the run down.
The idea is enticing that made me think about shorting the market again and also about shorting the home builders stocks in particular. For the latter I am looking for pressure points on the companies that is coming from multiple factors. If the fake market started to reflect the real economy then the stocks are going down just because they are stocks. But more over the inflation of the house prices is going to hit builders harder. Also, they have land inventory that is also going to crumble price wise. Finally, I want to look for highly leveraged companies debt wise because they are also going to be hit but their current loans on inventory and loans for operating expenses.
Here is a list of bunch of home builders, https://finance.yahoo.com/screener/unsaved/b926eccf-312b-478d-9fc6-5850d5e1d857. From these I choose the ones that are between 250M and 2B in cap. These usually have no extras to weather a storm.
| Ticker | Cap | Revenue | Net Income | Total Debt | Total Debt/Equity |
| NHO | 758 | 1,961,971 | 68.57 | 818 | 104 |
| CCS | 932 | 1,423,799 | 49,911 | 831 | 110 |
| BZH | 464 | 1,916,278 | -75.15 | 1,330 | 234 |
| AVHI | 477 | 843,253 | -26 | 472 | 110 |
| NWHM | 215 | 751,166 | -80 | 319 | 123 |
The only thing that might threaten this theis is mergers. And these can create substantial losses. Here is an example
You can also short via ETFs, like this guy here https://seekingalpha.com/article/31724-looking-to-short-real-estate-via-etfs.
I tried to isolate some of the larger companies based on my analysis. Lenar was one of them. Based on the latest release (http://investors.lennar.com/press-releases/2018/10-03-2018-110120404), I really cannot seen anythig wrong with it or at least wrong enough to short it.