Homebuilders' confidence continued to be at its lowest level in December as an effect of the deteriorating economic conditions, a trade group said Monday.

The National Association of Home Builders (NAHB)/Wells Fargo housing market index for December was unchanged from November's seasonally adjusted reading of 9, the lowest recorded level in the history of the index which began in 1985.

A reading above 50 indicates a positive sentiment about the market. However, the index has drifted below 50 since May 2006 and below 20 since April 2008 showing that that the number of builders thinking home-sales conditions are negative outnumbered those who think the market is generally well.

"We have seen no improvement over the past month in terms of sales conditions for new homes," said NAHB chief economist David Crowe in a statement. "In fact, certain factors have gotten progressively worse, not the least of which is the job market, where massive layoffs are having a devastating effect on consumer confidence."

The index has different measures and one is the part of the index that measures current sales conditions. It dropped one point to a reading of 8 in December. Last year, the reading was 18.

Also, sales expectations for the next six months dropped to 16 from 18 the previous month.  Last year, it stood at 26.

Traffic by prospective buyers was unchanged in December, with an index reading of 7, but still a historic low for the measure.

In the Midwest and South, homebuilders' assessment of the housing markets got worse in December while the index for the Northeast was unchanged.

The index for the West, rebounded slightly in December. This had been the weakest of the four regions last month.

 "The crisis continues," said Sandy Dunn, NAHB chairman, in a statement. "Buyers are afraid to move forward, and...there is almost no way to compete with the cut-rate product that is continually flooding the market from mounting foreclosures."

Several factors affects the housing market particularly the glut of foreclosed properties, which deters new construction and erodes the value of existing homes and that the housing market is being drained of potential buyers by rising unemployment.

This year alone, according to the Labor Department, the economy has lost nearly 2 million jobs.

Meanwhile, the weak economy and the housing glut have driven home prices down to its low levels.