Homebuilder confidence fell to 56 in January, missing expectations for the reading to stay unchanged at 58.
December’s reading was revised down to 57, from 58.
A reading over 50 shows that more builders think sales conditions are good rather than poor.
“Following an unexpected jump last month, builder confidence has essentially leveled out and is holding at a solid level,” NAHB Chairman Rick Judson said in a press release.
All three components of the housing market index (HMI) slowed in January. “The index gauging current sales conditions edged one point lower to 62, while the index gauging expectations for future sales fell two points to 60. The index gauging traffic of prospective buyers fell three points to 40.
New home sales fell 2.1% in November to an annualized pace of 464,000. And housing starts are expected to ease in December.
Meanwhile, homebuilder sentiment has been decoupling from reality as housing starts have failed to keep up.