Bottomless pit comes to mind when describing the housing sector, a description definitely being shared by many homebuilders. The housing market index, compiled by the National Association of Homebuilders together with Wells Fargo, fell 1 point in January to a record low of 8 -- a level indicating that nearly all respondents are reporting month-to-month contraction. A year ago the index was at what seemed to be an impossibly weak level of 19. The weakest component in the latest report, unfortunately, is current sales of single family homes where the index is at 6.
The biggest disappointment in today's report is that the recent decline in mortgage rates doesn't seem to be having much impact, at least yet. There was no reaction to the report which points to continued depressed readings in month-end data on home sales.