NEW YORK, March 18 (Reuters) - U.S. homebuilder

confidence rose in March to the highest level since July due to

easing mortgage rates and an improved pricing environment amid a

continued existing home inventory shortage, the National

Association of Home Builders said on Monday.

The NAHB/Wells Fargo Housing Market Index of builder

confidence rose to 51 this month from an unrevised 48 in

February. A Reuters poll showed economists expected the outlook

to remain unchanged at 48 in March.

"Buyer demand remains brisk and we expect more consumers to

jump off the sidelines and into the marketplace if mortgage

rates continue to fall later this year," NAHB Chairman Carl

Harris said in a statement.

Traffic slowed during the second half of last year on the

back of the Federal Reserve's interest rate hikes, which were

launched in March of 2022 in an effort to curb rising inflation.

The monetary policy tightening drove the average rate on the

30-year fixed-rate mortgage to two-decade highs near 8% in

October.

With the U.S. central bank likely near the end of its rate

hiking cycle, the 30-year fixed-rate mortgage averaged 6.74% for

the week ended March 14, according to Freddie Mac. The drop has

drawn buyers from the sidelines, raising the index of

prospective buyers from a 13-month low of 21 in November to 34

in March - the highest since August 2023, according to the NAHB.

The easing of mortgage rates has also allowed builders to

hold off on slashing home prices. As recently as December, more

than a third of builders reported offering price concessions. In

March, that was down to 24%, the lowest level since July 2023,

the NAHB said.