NAHB adds to fears of US housing slump
FEARS of a double-dip in the US housing market grew yesterday after a key housing index slumped to a 15-month low and expectations of future sales were extremely weak
The NAHB index, which measures sentiment on home building, slumped in July to 14 from a downwardly-revised 16 in June, indicating that demand for new homes has weakened further. The future sales index declined from 27 to 11 and the prospective buyers index dropped from 16 to 10.
“It is becoming increasing clear that without the government’s artificial support, the US housing market is struggling to stand on its own two feet,” said Paul Dales, US?economist at Capital Economics.
Some fall in activity was expected as a result of the expiry in the homebuyer tax credit in April. However, US home builders have been citing other factors such as high unemployment, tight credit conditions and the recent slowdown in economic activity, Dales added.