U.S. pending home sales hit one-year low in January

WASHINGTON, Feb 29 (Reuters) - Contracts to buy previously owned U.S. homes fell to their lowest level in a year in January, likely weighed down by harsh weather and a shortage of properties for sale, a report showed on Monday.

The National Association of Realtors said its pending home sales index declined 2.5 percent to 106.0, the lowest level since January of last year. Economists polled by Reuters had forecast contracts rising 0.5 percent last month.

Pending home contracts become sales after a month or two, and January’s unexpected drop suggested home resales will likely weaken after rising only 0.4 percent last month. Contracts were up 1.4 percent from a year ago.

“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,” Lawrence Yun, the NAR’s chief economist, said in a statement.

Pending home sales tumbled 3.2 percent in the Northeast, which was blanketed by a massive snow storm in late January. They plunged 4.9 percent in the Midwest, but rose 0.3 percent in the South. Contracts decreased 4.5 percent in the West, which has seen a rapid increase in home prices amid tight inventories. (Reporting by Lucia Mutikani; Editing by Paul Simao)