A report from Wells Fargo and the National Association of Home Builders (NAHB) suggests that homebuilders were even more pessimistic in July as the housing market index fell two points to 16, creating a new historic low in the 22-year index.

Three components make up the index, all of which fell in the month.

The sales expectations index fell four points to 23, the traffic of prospective buyers component fell four points to 12, and the present housing index for single-family homes fell one point to 16.

The previous month's index experienced a single point drop to 18, which itself was an historic low.

"There is no way to put a positive spin on this number. It indicates that homebuilder sentiment is mired in the doldrums and suggests very little improvement in the pace of sales in the near term," said Charmaine Buskas, senior economics strategist at TD Securities.

In the last 12 months, the index has dropped a total of 8 points.

By Patrick McGee and edited by Sarah Sussman