Existing home sales drop 5.1% in January

Sales of previously owned homes plunged in January as severe weather and high costs handcuffed would-be buyers.

Existing home sales tumbled 5.1% from December to a seasonally adjusted annual rate of 4.62 million, reaching the lowest level in more than a year, the National Assn. of Realtors said Friday. Sales also fell 5.1% from a year earlier.

Although harsh weather held back sales, the trade group said there was more behind the poor figures.

“We can’t ignore the ongoing head winds of tight credit, limited inventory, higher prices and higher mortgage interest rates,” Lawrence Yun, the group’s chief economist, said in a statement. “These issues will hinder home sales activity until the positive factors of job growth and new supply from higher housing starts begin to make an impact.”

Sales fell in all regions last month. Sales fell 7.3% from December in the West, a major home building region largely spared the severe weather.

The national median sale price for a previously owned home last month was $188,900, up 10.7% from a year earlier.