UPDATE 2-US homebuilder sentiment falls again in January

(Adds regional details, economist comment)

By Corbett B. Daly

WASHINGTON Jan 19 (Reuters) - U.S. home builder sentiment unexpectedly fell in January to the lowest level since June on concerns over the weak labor market and high foreclosure volume, according to a survey on Tuesday.

The drop in the National Association of Home Builders/Wells Fargo Housing Market Index pointed to a patchy recovery in the housing sector.

The index, which measures builders' confidence in the market for newly built single-family homes, slipped to 15 in January from 16 last month, below market expectations for a reading of 17. A reading below 50 indicates more builders view sales conditions as poor than a good.

"Tight lending standards and concerns about job security appear to be offsetting attractive affordability and the tax credit, keeping the housing recovery on tenterhooks," said Sal Guatieri, senior economist at BMO Capital Markets.

The Federal Reserve "won't even think about tightening until this sector shows signs of a durable recovery," he added, referring to the Fed's ultra-low interest rates.

The drop in homebuilder sentiment follows data earlier this month from the National Association of Realtors showing previously-owned U.S. homes under contract to be sold fell more sharply than expected in November.

Housing, the main force behind the worst U.S. recession in seven decades, is slowly healing after a three-year slump. The homebuilder sentiment index is up sharply from the 8 reading in January 2009.

"Builders also realize that factors beyond our control -- including consumer concerns about job security and competition from foreclosed homes on the market -- are still impeding demand for new homes at this time," said Joe Robson, chairman of the NAHB.

The NAHB survey showed the current sales conditions gauge for single-family home sales dipped one point to 15 this month. The sales expectations measure for the next six months remained steady at 26. The traffic of prospective buyers index fell one point to 12 after remaining at 13 for three straight months.

Sentiment fell in all four U.S. regions. Sentiment fell most sharply in the West, to 16 from 19. In the Northeast sentiment fell to 22 from 23, while the index fell to 11 from 12 in the Midwest. Sentiment in the South, the country's largest region, fell to 16 from 17. (Editing by Leslie Adler)