NEW YORK (CNNMoney.com) -- Fewer Americans signed contracts to buy homes in January and further declines are expected.
The National Association of Realtors' Pending Home Sales Index dipped 7.6% in January to 90.4 from an upwardly revised to 97.8 in December. Economists surveyed by Briefing.com were expecting a 1% rise.
Although these are not closed sales, and some deals can fall through, signed contracts are a good indicator of where the housing market is headed.
Pending sales were still 12.3% higher than in January 2009, this is still an indication that the housing market may not be recuperating as much as expected. Pending home sales "remain much lower than expected given that a large number of potential buyers are eligible for the expanded homebuyer tax credit," said NAR chief economist Lawrence Yun.
That credit expires at the end of June, so industry experts had been anticipating heavy contract volume through the spring.
Yun said weakness will continue in February because the severe winter weather likely prevented Americans from shopping for homes. But he expects sales to surge in April, May and June.
"The real question is what happens in the second half of the year," Yun said. "If there is sufficient job creation, housing can become self-sustaining with stable to modestly rising home prices because inventory has been trending downward." 
| Overnight Avg Rate | Latest | Change | Last Week |
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| 30 yr refi | 3.82% | 3.93% | |
| 15 yr refi | 3.20% | 3.23% |
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