Small U.S. homebuilders are backing off from bringing more houses to the market, discouraged by a banking crisis-led credit squeeze and rising borrowing costs exacerbating the shortage of new homes. The housing market is also reeling with an acute supply squeeze due to a shortage of building materials and labor. …”I see a lot of small builders pulling back on some developments,” said Paul Schwinghammer, of Indiana-based Hallmark Homes. …”I expect tighter lending standards to weigh on housing construction as the year progresses and don’t look for the May pace of starts to be sustained,” said Nancy Vanden Houten at Oxford Economics. The latest Federal Reserve survey on lending practices showed 73.8% of 61 banks said they had tightened their credit standards for construction and land development loans. …The situation may not change soon given small builders are struggling to sell existing inventory, said Kenneth Zener of Seaport Research Partners.