NEW YORK (Reuters) - U.S. homebuilder sentiment fell in May but still showed more builders view market conditions as favorable, the National Association of Home Builders said on Monday.

The NAHB/Wells Fargo Housing Market index fell to 54 from 56 the month before, the group said in a statement. Economists polled by Reuters had predicted the index would rise to 57.

Readings above 50 indicate more builders view market conditions as favorable than poor. The index has not been below 50 since June 2014.

"Consumers are exhibiting caution, and want to be on more stable financial footing before purchasing a home," NAHB Chief Economist David Crowe said in a statement.

"On the bright side, the HMI component measuring future sales expectations has been tracking upward all year, mortgage rates remain low, and house prices are affordable. These factors should spur the release of pent-up demand moving forward."

The single-family home sales component fell to 59 from 61 in April. The gauge of single-family sales expectations for the next six months rose to 64 from a revised 63, while prospective buyer traffic fell to 39 from a revised 40.

(Reporting by Sam Forgione; Editing by Meredith Mazzilli)