RTTNews - Homebuilder confidence has deteriorated in the month of June, according to a report released by the National Association of Home Builders on Monday, with the decrease seen as an indication that homebuilders remain cautious and concerned about the fragile state of the housing market.
The report showed that the National Association of Home Builders/Wells Fargo Housing Market Index fell to a reading of 15 in June from a reading of 16 in May. Economists had been expecting the index to edge up to a reading of 17.
NAHB Chief Economist David Crowe said, Builders are taking their cue from consumers, who remain uncertain about the economy and their own situation.
Builders are also finding it difficult to complete a sale because customers cannot sell their existing homes, Crowe added.
The NAHB also said that the index gauging current home sales as well as the index gauging traffic of prospective buyers were both unchanged at 14 and 13, respectively.
Meanwhile, the report showed that the index gauging expectations for the next six months declined by a single point to 26.
NAHB Chairman Joe Robson said, The outlook for home sales has improved somewhat in recent months, due largely to implementation of the first-time home buyer tax credit and gains in housing affordability.
However, looking forward, home builders are facing a few headwinds, including expiration of the tax credit at the end of November; a recent upturn in interest rates; and especially the continuing lack of credit for housing production loans, Robson added.
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