Sales of new single-family homes dropped 9.2 percent in January to a seasonally adjusted 494,000 annual rate, the NAHB said, citing government data.

"After an unusually high December reading, some pullback is to be expected," said Ed Brady, chairman of the National Association of Home Builders and home builder and developer from Bloomington, Illinois. "On the positive side, builders are adding inventory in anticipation of future business."

David Crowe, the association’s chief economist, said it appears buyers are still interested in new homes. "Consumers are exhibiting caution in the face of some uncertain market conditions," Crowe said. "The average of the December-January reports shows that housing is moving forward at a modest pace, buoyed by relatively low interest rates and ongoing job creation."

New-home inventory rose to 238,000 units in January, a 5.8-month supply at the existing sales pace, the association added.