This winter's severe weather has been holding down certain areas of the economy more than others, and especially holding down housing. The home builders' housing market index fell very sharply, down a record 10 points to a much weaker-than-expected 46 which is the lowest reading since May last year. The reading is far below the low-end Econoday estimate for 54. The traffic component fell 11 points to a very weak 31 which is the lowest reading since April.
The component for current sales slowed substantially, also down 11 points but to a still plus-50 level of 51 that indicates monthly growth. Future sales fell 6 points to a still respectable 54. The regional breakdown shows broad weakness especially in the Northeast. The strongest region remains the West where California has been mostly spared by heavy weather.
The housing market has been stumbling the past few months due hopefully to the temporary issue of weather in what would point to a snap-back for the spring. But other factors are still negative for the sector including unappealing mortgage rates, high prices, low supply, and a soft jobs market. Housing starts for January, which slipped in December following a surge in November, will be posted tomorrow on the Econoday calendar at 8:30 a.m. ET.