NEW YORK -- U.S. home builder sentiment hovered near all-time lows in April, with early spring shopping not yet boosting sales of new homes, the National Association of Home Builders said on Tuesday.
The NAHB/Wells Fargo Housing Market index was unchanged at 20 for the third straight month as one of the worst housing markets in a century persists.
The confidence index held slightly above the low of 18 set in December, the weakest reading since the survey began in January 1985. It was directly in line with the estimate of 41 economists polled by Reuters.
Readings below 50 mean more builders view market conditions as poor than favorable.
"With the traditional home-buying season now well under way, we have not seen the bump in sales activity that we normally would this time of year," Sandy Dunn, NAHB president and a home builder from Point Pleasant, West Virginia, said in a news release.
Story Continues Below
Lenders have become tougher in doling out mortgages, shaken by record defaults and foreclosures during the housing market meltdown.
Many buyers remain cautious, concerned about purchasing a home that could lose value if prices keep sliding, as many economists expect.
The builders group is pressing for Congress to take steps soon to heighten demand for homes.
"Measures that stimulate consumer confidence in the housing market, push the fence-sitters into the ring and put a floor under house prices can successfully halt the drag that housing is exerting on the national economy, and help stabilize financial markets at the same time," NAHB Chief Economist David Seiders said.
"But such measures need to be implemented as soon as possible in order to limit the severity of the economic recession that now is underway," he added.
Members of the trade group stand to benefit under a U.S. Senate bill that would give home builders a $6 billion tax break. The bill, approved on Thursday by the Senate, temporarily extends a rule that lets businesses count current losses against taxes from prior profitable years.
The legislation is opposed by the White House and has been criticized as too laden with business tax breaks by some lawmakers. The House of Representatives, where the bill next goes, is working on a narrower housing plan that focuses on tax breaks for homeowners.
In April, the NAHB's measure of current single-family sales declined to 18 from 20 in March.
The gauge of prospective buyer traffic was unchanged at 19 in April for the third month, maintaining the highest level since posting the same reading in July 2007.
In a bright spot, the NAHB's index of single-family sales for the next six months rose 4 points to 30 in April, the highest since 31 in August 2007.
All three sub-indices were below readings a year earlier, when the current sales measure was 33, prospective buyer traffic was 27 and sales for the next six months was 44, the NAHB said.
Builder sentiment was mixed across regions of the country. It gained 1 point to 22 in the Northeast, rose 2 points to 17 in the West, and dropped 1 point to 15 in the Midwest and 2 points to 24 in the South.
© Reuters 2008. All rights reserved. Republication or redistribution of Reuters content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Reuters.
Editor's note:
The Recession's Silver Lining. What it Means for Investors.
Investors now urged to avoid the Euro. Find out why.
Capture 10% to 15% Dividend Income Every Month
Money Pouring Into Medical Devices Sector. Best ETF to Own Now.
