U.S. homebuilder sentiment declined for a third straight month in March but still showed more builders view market conditions as favorable, the National Association of Home Builders said on Monday.
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The NAHB/Wells Fargo Housing Market index fell to 53 from 55the month before, the group said in a statement. Economistspolled by Reuters had predicted the index would edge up to 56.
Readings above 50 mean more builders view market conditionsas favorable than poor. The index has not been below 50 sinceJune 2014.
"The drop in builder confidence is largely attributable to supply chain issues, such as lot and labor shortages as well as tight underwriting standards," NAHB Chief Economist David Crowe said in a statement.
"These obstacles notwithstanding, we are expecting solid gains in the housing market this year, buoyed by sustained job growth, low mortgage interest rates and pent-up demand."
The single-family home sales component fell to 58 from 61,marking the second straight drop in the subindex. The gaugeof single-family sales expectations for the next six months wasflat at 59, while prospective buyer traffic slipped to 37 from 39, marking a third straight monthly decline.
(Reporting by Chuck Mikolajczak; Editing by Meredith Mazzilli)