Homes sales and prices – along with construction activity – have improved over the past few months, but a true recovery in the housing sector is still far away due to tight mortgage credit, according to Federal Reserve monetary policy officials.

“Despite some signs of improvement, the housing sector remains depressed,” Fed officials concluded at a two-day meeting in June.

The Fed released the minutes of June 19-20 Federal Open Market Committee (FOMC) meeting Wednesday afternoon.

The minutes reveal that the most FOMC members expect a slow housing recovery due in part to tight mortgage lending standards.

The central bank’s efforts to reduce mortgage rates are “generating less of a pickup in home sales and construction than had been the case during the recoveries from earlier recessions,” the minutes say.

FOMC members also recognize that residential investment is much smaller now due the housing crash than in past recoveries.  The housing sector is “unlikely to contribute substantially to a stronger economic recovery.”

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