Financial News: U.S. Homebuilder Confidence Unexpectedly Deteriorates In J

U.S. Homebuilder Confidence Unexpectedly Deteriorates In January

(RTTNews) - A report released by the National Association of Home Builders on Friday showed an unexpected deterioration in U.S. homebuilder confidence in the month of January.

The report said the NAHB/Wells Fargo Housing Market Index dipped to 37 in January from 39 in December. Economists had expected the index to inch up to 40.

The unexpected decrease by the housing market came a month after it reached its highest level since hitting 40 last April.

"While the upper end of the housing market is holding steady, affordability conditions are taking a toll on the lower and mid-range sectors," said NAHB Chairman Buddy Hughes.

He added, "Buyers are concerned about high home prices and mortgage rates, with downpayments particularly challenging given elevated price to income ratios."

The pullback by the headline index came as the index measuring future sales fell to 49 in January from 52 in December, dropping below the breakeven point of 50 for the first time since September.

NAHB Chief Economist Robert Dietz said the decrease by the future sales component indicates "builders continue to face several issues that include labor and lot shortages as well as elevated regulatory and material costs."

The gauge charting traffic of prospective buyers also slid to 23 in January from 26 in December, while the index gauging current sales conditions edged down to 41 in January from 42 in December.

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