New U.S. single-family home sales fell more than expected in January, a government report showed on Thursday, pulled down by a plunge in activity in the country's West as a homebuyer state tax credit in California ended.

The Commerce Department said sales tumbled 12.6 percent to a seasonally adjusted 284,000 unit annual rate after a downwardly revised 325,000-unit pace in December.

Economists polled by Reuters had forecast new home sales sliding to a 310,000-unit pace last month from a previously reported 329,000 unit rate.

Compared to January last year sales were down 18.6 percent. Sales surged in December as buyers in California rushed to take advantage of the tax credit for new homes. Sales in the West plunged 36.5 percent after spiking 62.5 percent the prior month.

A glut of foreclosed houses on the market is putting pressure on new home sales, forcing builders to drastically scale back on construction projects. Analysts expect new home sales to remain depressed.

Data on Wednesday showed sales of previously owned homes were the highest in eight months in January, but were driven by a surge in purchases of distressed properties.

At January's sales pace, the supply of new homes on the market rose to 7.9 months' worth from 7.0 months' worth in December. There were 188,000 new homes available for sale last month, the lowest since December 1967.

The median sales price for a new home fell 1.9 percent last month from December to $230,600. Compared with January last year, the median price was up 5.7 percent.

(Reporting by Lucia Mutikani, Editing by Andrea Ricci)