NEW YORK (Reuters) - U.S. homebuilder sentiment unexpectedly declined in June to its lowest level since September 2010 as the market continued to struggle, the National Association of Home Builders said on Wednesday.
The NAHB/Wells Fargo Housing Market index fell to 13 in June from 16 in May whereas a Reuters poll of economists had expected the gauge to hold at 16. The index had come in at 16 in six of the past seven months as of May.
Readings below 50 mean more builders view market conditions as poor than favorable. The index has not been above 50 since April 2006.
Persistent weakness in existing home prices and rising materials costs have hit homebuilders, NAHB said.
“Builder confidence has waned even further as economic growth has stalled, foreclosures have continued to hit the market and the cost of building a home has risen,” said NAHB chief economist David Crowe in a statement.
“Economic growth must pick up in order for housing to gain the momentum it needs to get back on track,” he added.
Reporting by Leah Schnurr; Editing by James Dalgleish