Pending home sales fell 2.5% in January, the biggest monthly decline since January 2014.
Economists had estimated that signed contracts for existing single-family homes, condos and co-ops rose 0.5% according to Bloomberg. Last month, pending home sales increased 0.9% (revised from 0.1%).
According to the National Association of Realtors (NAR), only the South saw an increase in contract activity.
“While January’s blizzard possibly caused some of the pullback in the Northeast, the recent acceleration in home prices and minimal inventory throughout the country appears to be the primary obstacle holding back would-be buyers,” wrote NAR chief economist Lawrence Yun in the release.
Yun added that while rising home prices could encourage home selling, affordability would not improve until inventory levels — especially of lower-priced homes — increase.
Economists at Bank of America Merrill Lynch had forecast a decline.
“New home sales weakened in January as did mortgage purchase applications,” they wrote prior to the report. “The recent weakness in signed contracts will likely translate to a decline in existing home sales in coming months, which have looked exceptionally strong.”