Sales of previously owned U.S. homes fell in January by the most in nearly four years, a month marked by a massive winter storm.

Contract closings decreased 8.4%, the biggest drop since February 2022, to a 3.91 million annualized pace in January, according to National Association of Realtors data released Thursday. That trailed the median forecast of economists surveyed by Bloomberg.

An extensive winter storm in late January that blanketed much of the U.S. with snow and ice may have delayed many contract closings. In the hard-hit South, the nation’s biggest home-selling region, sales slumped 9% to an annualized pace of 1.81 million. Closings also fell sharply in the rest of the country.

“The below-normal temperatures and above-normal precipitation this January make it harder than usual to assess the underlying driver of the decrease and determine if this month’s numbers are an aberration,” NAR Chief Economist Lawrence Yun said in a statement.

One emerging bright spot for the housing market is signs of improving affordability, with mortgage rates receding recently along with price growth. The NAR’s housing affordability gauge climbed last month to the highest since 2022, though it remains well short of pre-pandemic levels.

Without an extended period of improved affordability, the recovery in the housing market is likely to be prolonged. The NAR report showed the median selling price rose 0.9% from a year earlier to $396,800 last month.

First-time buyers represented 31% of buyers of existing homes in January, up slightly from 29% in the prior month and higher than a year ago.

The inventory of previously owned homes increased 3.4% in January from a year ago to 1.22 million. A pickup in supply through 2025 has helped to tame price growth, though Yun said on a call with reporters that listings need to increase much more to help improve sales.

Market analysts see home sales climbing this year, with estimates ranging from 1.7% to 14%, according to a December survey by Bloomberg, as home prices finally slow their rapid rise and borrowing costs also level off. Mortgage rates fell to a more than one-year low of 6.16% last month.

President Donald Trump has tried to jumpstart the housing market with a series of initiatives, as Republicans in Congress face stiff campaign challenges over a lack of affordability. Among them, he moved to ban institutional investors from purchasing single-family homes and directed Fannie Mae and Freddie Mac to buy $200 billion in mortgage bonds.

(With assistance from Chris Middleton.)

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