Economic uncertainty, severe winter weather and housing affordability concerns acted as headwinds on the market in January.

Sales of newly built single-family homes fell 17.6% in January, to a seasonally adjusted annual rate of 587,000 from a downwardly revised December reading, according to newly released data from the U.S. Department of Housing and Urban Development and the U.S. Census Bureau. The pace of new home sales is down 11.3% from a year earlier.

“January’s dip in new home sales reflects typical monthly volatility, as well as weather-related disruptions, most notably in the Northeast and Midwest,” said NAHB Chairman Bill Owens, a home builder and remodeler from Worthington, Ohio. “On a three-month moving average basis, sales were 688,000, remaining broadly in line with the 685,000 pace seen a year ago. Builders are increasingly using incentives, including price reductions and upgraded features, to attract buyers and sustain market momentum amid ongoing affordability challenges.”

“New home sales fell in January largely because of weather-related disruptions, even as mortgage rates eased modestly,” said Jing Fu, NAHB senior director of forecasting and analysis. “According to the Freddie Mac Primary Mortgage Market Survey, the 30-year fixed mortgage rate averaged roughly around 6.1% during January, providing some relief for buyers. However affordability pressures, including economic uncertainty, elevated construction costs and tariff risks, continue to constrain activity.”

A new home sale occurs when a sales contract is signed, or a deposit is accepted. The home can be in any stage of construction: not yet started, under construction or completed. In addition to adjusting for seasonal effects, the January reading of 587,000 units is the number of homes that would sell if this pace continued for the next 12 months.

New single-family home inventory in January rose to 476,000 units, 0.4% higher than the previous month, but 4.0% lower than a year earlier. This represents a 9.7 months’ supply at the current building pace. Completed for-sale new homes remained unchanged at 126,000, the highest level since 2009.

The median new home sale price was $400,500, down 6.8% from a year ago. On a year-to-date basis, nationally new home sales rose 1.4%.

Regionally, on a year-to-date basis, new home sales are up 1.4% in the Midwest and 4.1% in the South. New home sales are down 8.3% in the Northeast and 3.5% in the West.