Severe winter weather from the south to the northeast kept prospective homebuyers indoors, resulting in home buying traffic at its lowest pace since April 2013.
The National Association of Home Builders sentiment rating slumped to 46 from 56 in January, according to the Washington-based group's figures released in mid-February. Readings less than 50 mean more respondents in the group reported poorer market conditions than good.
Sales expectations also fell due to builder confidence declining from coast to coast. New housing construction is now expected to contribute less to the nation's overall economic growth at the beginning of 2014.
Don't Blame the Weather in the West
According to Jed Kolko at Trulia, while bad weather hurts construction and sales, it gets an unfair share of the blame. He said, "Two other factors are holding back sales: rising prices and the decline in foreclosure inventory. In the last quarter of 2013, sales dropped most in the west, where home price increases have been steepest, putting homes farther out of many buyers' reach and making the math less favorable for investors."
Indeed, while home sales are weaker across the nation, they are falling hardest in the west, where the weather has been less of a factor. Recent numbers from southern California provide a clear example. Closed sales there in December fell 21.4 percent from November and were down nearly 10 percent from December 2012, according to San Diego-based DataQuick.