Pending home sales tumble in January

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In another sign that the foundation of the U.S. housing recovery may be shaky, the number of homes placed under sales contracts fell 7.6% in January, according to a national index.

The National Assn. of Realtors said its pending home sales index, a forward-looking indicator based on contracts signed in January, fell to 90.4 from an upwardly revised 97.8 in December.

That remains 12.3% higher than January 2009, when it was 80.5. The group blamed the weather for the month-over-month decline.

“January pending sales, though still higher than one year ago, remain much lower than expected given that a large number of potential buyers are eligible for the expanded home buyer tax credit,” Lawrence Yun, chief economist for the Realtors group said in a statement. “Moreover, the abnormally severe and prolonged winter weather, which affected large regions of the U.S., hampered shopping activity in February.”

-- Alejandro Lazo