US NAHB housing market index falls to 54 in May from 56 in April

According to the National Association of Home Builders/Wells Fargo figures released on Monday, a gauge of confidence among homebuilders in the US dropped two points to 54 in May, led lower by views on current sales of single-family homes.

The reading represents a nine point increase from the May 2014 reading of 45.

“Consumers are exhibiting caution, and want to be on more stable financial footing before purchasing a home,” said NAHB Chief Economist David Crowe.

“On the bright side, the Housing Market Index component measuring future sales expectations has been tracking upward all year, mortgage rates remain low, and house prices are affordable. These factors should spur the release of pent-up demand moving forward,” he added.

The index’s components were mixed in May. The component charting sales expectations in the next six months rose one point to 64, while the index measuring buyer traffic dropped one point to 39, and the component gauging current sales conditions fell by two points to 59.