Labor Shortages Keep Builder Confidence Stagnant for February

U.S. homebuilders are feeling slightly less confident in their sales prospects, but their overall sales outlook remains favorable.

The National Association of Home Builders/Wells Fargo builder sentiment index released Monday slipped to 53 this month, down two points from 55 in February. It's the third monthly decline in a row for the index.

Readings above 50 indicate more builders view sales conditions as good, however.

Labor shortages ( a problem not shared by modular home builders), a dearth of available land parcels cleared for new home construction and tougher mortgage-lending standards weighed on builders' confidence this month, said David Crowe, the builder group's chief economist.

"These obstacles notwithstanding, we are expecting solid gains in the housing market this year, buoyed by sustained job growth, low mortgage interest rates and pent-up demand," Crowe added.

Despite the increasingly favorable economy, home sales have been sluggish so far this year after a lackluster 2014.

Sales of new U.S. homes were basically flat in January, slipping 0.2 percent from the previous month to a seasonally adjusted annual rate of 481,000. Sales climbed 5.3 percent from a year earlier, when harsh winter weather caused home-buying to stall.

Still, lower mortgage rates and job gains over the past year are among the factors pointing to stronger sales this spring buying season, traditionally the peak period for home sales.