The National Association of Home Builders/Wells Fargo Housing Market Index for June returned to its historic low of 18, set in December of last year, the NAHB reported Monday.
"Clearly, conditions in the housing market remain very weak, and our builder members are not seeing any signs of improvement," said NAHB chief economist David Seiders. "Continuing erosion of employment and consumer confidence/sentiment, coupled with surging energy costs, falling house prices and rising home mortgage foreclosures, pose considerable downside risks to the economy and our housing forecast."
The HMI's component index gauging current sales conditions was unchanged at 17; its component index of sales expectations for the next six months also held steady at 28. Meanwhile, the component gauging traffic of prospective buyers fell a single point to 17.
Regionally, the HMI for the Northeast dropped six points to 12, its lowest-ever reading since NAHB began reporting regional sentiment in December, 2004. The Midwest gained five points to 17, the South was unchanged at 22 and the West dropped four points to 16.
NAHB CEO Jerry Howard called a special teleconference during which he called on Congress to act on legislation that would target the sagging housing industry.
"Each week that goes by, another 15,000 workers are losing their jobs and 47,000 families are entering foreclosure. Home equity has fallen by $879 billion during the past year alone," said Howard. "How many more Americans have to suffer before Congress will act?"
The NAHB has been lobbying Congress for a temporary tax credit for home buyers similar to one enacted in 1975. That program was credited with pulling the housing industry out of a stagflation slump that was in some ways similar to what is occurring now, though it was not as deep or widespread.
The Senate is expected to begin debate on a housing stimulus package later this week.