Builders' confidence in the market for new single-family homes was lower as the National Association of Home Builders' housing market index - a monthly gauge of builder sentiment – declined to 58 in February from an upwardly revised 61 in January.
The January reading was originally reported as 60.
Thomson Reuters' poll of economists predicted the index would be 60.
"Though builders report the dip in confidence this month is partly attributable to the high cost and lack of availability of lots and labor, they are still positive about the housing market," NAHB Chairman Ed Brady said. "Of note, they expressed optimism that sales will pick up in the coming months."
"Builders are reflecting consumers' concerns about recent negative economic trends," according to NAHB Chief Economist David Crowe. "However, the fundamentals are in place for continued growth of the housing market. Historically low mortgage rates, steady job gains, improved household formations and significant pent up demand all point to a gradual upward trend for housing in the year ahead."
Derived from a monthly survey that NAHB has been conducting for 30 years, the NAHB/Wells Fargo HMI gauges builder perceptions of current single-family home sales and sales expectations for the next six months as either "good," "fair" or "poor." The survey also asks builders to rate traffic of prospective buyers as either "high to very high," "average" or "low to very low." Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view sales conditions as good than poor.
The current single-family home sales index dropped to 65 from 68, the sales expectations index for the next six months gained to 65 from 64; and the traffic of prospective buyers index fell to 39 from 44.
