If there’s an economic indicator that gets released these days, taking the under usually ends up being the prudent bet. Today’s release of homebuilder sentiment for the month of July from the NAHB on Tuesday was the latest example. While economists were expecting the headline reading to come in at a level of 67, the actual reading was 64- the weakest reading since November. After a four-month surge post-election, the last four months have seen homebuilder sentiment decline in three of the last four months. Making matters worse, Tuesday’s reading was the weakest relative to expectations since May 2015.
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The table below breaks down July’s report by Present and Future Sales, Traffic, and Regions. There wasn’t much to get excited about in July as every category of the report declined. On a regional basis, sentiment was more mixed with relatively large declines in the Midwest and South but actually increases in both the Northeast and West. Finally, Tuesday’s NAHB sentiment reading comes ahead of Wednesday’s report on Housing Starts, which has been weaker than expected for three straight months and Building Permits, which has missed the mark each of the last two months.