Analysing shortest path for real time traffic environment is crucial with dynamic updating. VANET technology can be used for analysing traffic but generates a huge amount of data to be exchanged, which demands more processing power and resources. In this paper, a new histogram-based route guidance algorithm (HBA) has been proposed based on light weight processing. The proposed algorithm enables selecting the shortest path between any source and destination using the histogram models, which capture the higher order distribution function of the number vehicles in every lane. Furthermore, the histogram model is used to estimate the traffic delays at intersections and roundabouts. The data entity collection through sensors used for histogram modelling is presented in detail. The experimental results show that the proposed algorithm provides a good prediction of road traffic status and a better solution for the congestion problem in the urban areas.