Since upgrading my iPhone 4 recently, the home button has been a complete pain. Doing some googling yielded various results, ranging from re-calibration to having my phone replaced. I came across the following steps, which fixed the issue for me.
Step 1: Navigate to, and launch one of the stock applications on your iPhone. If you don’t already know, the stock apps are things like weather, YouTube, stocks, settings etc (any that come as part of iOS).
Step 2: When the app is launched, press and hold the Power button located at the top of the device until the ‘Slide to power off’ appears.
Step 3: Press and hold the iPhone home button. Keep the button depressed until the Slide to power off slider disappears and the application quits back to Springboard.
Step 4: Voila! Your home button is now re-calibrated and should be more responsive for you.