Homebuilder Index Holds Near Low in March
U.S. home builder sentiment remained mired near historic lows in March, the National Association of Home Builders said Monday, as the worst housing slump since the Depression kept buyers and home financing in short supply.
The NAHB/Wells Fargo Housing Market index held steady at 20 in March, the group said in a statement. It remains within sight of December's historic low reading of 18, the lowest since the survey began in January 1985.
The result was exactly in line with expectations of economists polled by Reuters. Readings below 50 mean more builders view market conditions as poor than favorable.
The index remains well below the peak of the most recent economic expansion, a reading of 72 reached in June 2005. Its highest reading was in December 1998, when it reached 78.
March's report showed that the credit crunch that has arisen from the mortgage market meltdown is deterring buyers. "Our surveys confirm what I've been hearing personally from builders across the country, which is that interested buyers are out there, but they are either reluctant to go ahead with a home purchase or they are unable to find mortgage financing they can afford," said NAHB President Sandy Dunn, a home builder from Point Pleasant, West Virginia.
Stocks remained sharply lower, driven by news that JPMorgan Chase had bought Bear Stearns at a fire sale price, the latest sign of spreading fallout from a persistent global credit crisis.
The dollar remained lower across the board. Government bonds, which usually benefit from weak economic data, slightly extended earlier sharp gains.
The measure of current single-family sales also held steady at 20 in March. The NAHB's index for single-family sales for the next six months fell to 26 in March from 27 in February.
The gauge measuring the traffic of prospective buyers was also unchanged at 19 in March, remaining for a second consecutive month at its highest since July 2007.
Regionally, the index covering the Northeast slipped to 21 from a downwardly revised 23 in February. The Midwest held steady at 16 for the third month. The South advanced to 26 from 24. The West eased to 15 from an upwardly revised 16.