U.S. HOMEBUILDER SENTIMENT TUMBLES AS RATES SLOW BUYER TRAFFIC

U.S. homebuilder sentiment soured in May for the first time in six months as high interest rates on home loans kept potential customers on the sidelines and more builders had to offer incentives to lure buyers. The National Association of Home Builders/Wells Fargo Housing Market Index fell unexpectedly to 45 in May, the lowest since January, from 51 a month earlier.

NAHB measures of current sales, sales expectations for the next six months and traffic of potential buyers all fell. According to the Mortgage Bankers Association, interest rates on a 30-year fixed rate mortgage have held above 7% since early April.

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