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The National Association of Realtors (NAR) Wednesday morning released its data on pending sales of existing homes for the month of January. The pending home sales index fell 4.7% from a downwardly revised December reading of 109.8 to 1104.6.

December sales declined in all four NAR geographical regions.

The consensus estimate called for a month-over-month increase of 0.5% in pending sales. The index reflects signed contracts, not sales closings. An index reading of 100 equals the average level of contract signings during 2001.

The index has been above 100 (the “average” reading) for 39 straight months.

The NAR’s chief economist, Lawrence Yun, noted:

The economy is in great shape, most local job markets are very strong and incomes are slowly rising, but there’s little doubt last month’s retreat in contract signings occurred because of woefully low supply levels and the sudden increase in mortgage rates. The lower end of the market continues to feel the brunt of these supply and affordability impediments. With the cost of buying a home getting more expensive and not enough inventory, some prospective buyers are either waiting until listings increase come spring or [are] now having to delay their search entirely to save up for a larger down payment.

Yun continued:

Even though contract signings were down, Realtors® indicated that buyer traffic in most areas was up [in] January compared to a year ago1. The exception was likely in the Northeast, where the frigid cold snap [in] the first two weeks of the month may have contributed some to the region’s large decline.

By region, January pending home sales fell by 9% to an index score of 87 in the Northeast, down 12.1% compared with January 2017. In the Midwest, sales dipped 6.6% to an index score of 98.2, down 4.1% compared to last year’s index.

Sales fell by 1.2% in the West to an index score of 97.97 and remain down 2.5% year over year for the month. Sales in the South declined 3.9% to 121.9 in January and are now 1.1% below the year-ago index score.

Existing-home sales closed 2017 at around 5.51 million. Yun expects 2018 sales of around 5.5 million, down from a prior estimate of 5.8 million. The national median existing-home price in 2017 rose by 5.8%. In 2016, existing sales increased 3.8% and prices rose 5.1%. Yun now estimates that 2018 price growth would moderate to around 2.7% for the year.