The National Association of Homebuilders (NAHB) announced on Wednesday its housing market index (HMI) fell 42 points to 30 in April from an unrevised March reading of 72. This drop is the largest one-month decline in the history of the index and marks the lowest builder confidence reading since June 2012.

Economists had forecast the HMI to drop to 55.

A reading over 50 indicates more builders view conditions as good than poor.

All three HMI components registered declines this month. The indicator gauging current sales conditions decreased 43 points to 36 in April, while the component measuring traffic of prospective buyers also fell 43 points to 13 and the measure charting sales expectations dropped 39 points to 36.

NAHB Chairman Dean Mon noted: "This unprecedented drop in builder confidence is due exclusively to the coronavirus outbreak across the nation, as unemployment has skyrocketed and gaps in the supply chain have hampered construction activities."

Meanwhile, NAHB Chief Economist Robert Dietz said: "While the virus is severely disrupting residential construction and the overall economy, the need and demand for housing remains acute. As social distancing and other mitigation efforts show signs of easing this health crisis, we expect that housing will play its traditional role of helping to lead the economy out of a recession later in 2020".