Housing stocks declined Thursday after a widely watched home price index posted a record decline and a credit ratings agency said risky mortgages are increasingly defaulting.
The government said Thursday that home prices fell 3.1 percent in the first quarter compared with last year. That marked the largest drop in the index's 17-year history and only the second quarter of price declines ever recorded.
Meanwhile, Standard & Poor's said delinquencies among 2005 vintage subprime loans rose 2 percent to 36.8 percent in April from the previous month. Delinquent loans from 2006 jumped 4 percent to 37.1 percent.
Subprime mortgages are home loans given to customers with poor credit history.
The news signals that the housing and mortgage markets continue to struggle with a bottom not yet in sight.
Centex Corp.'s stock lost 32 cents to $19.93 in afternoon trading, while KB Home's shares fell 17 cents to $21.55. Pulte Homes Inc. gave back 19 cents to $12.58.
Luxury builder Toll Brothers Inc. decreased 8 cents to $21.97, while competitor Hovnanian Enterprises Inc. dropped 31 cents, or 3.7 percent, to $7.98.
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