Home sales in September slowed 2% to a seasonally adjusted annual rate of 3.96 million, the National Association of Realtors reported Thursday, as higher mortgage rates priced out many would-be buyers and led many homeowners to avoid selling and having to reenter the home loan market.

The pace of home sales was down 15.4% from the year before.

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Total housing inventory at the end of September was 1.13 million units, up 2.7% from August but down 8.1% from a year ago.

The median price of an existing home in September was $394,300, an increase of 2.8% from the year before. Additionally, homes typically remained on the market for 21 days in September, up from 20 days in August and 19 days in September 2022.

The news comes as mortgage rates rise to levels not seen in more than two decades.

The average rate on a 30-year fixed-rate mortgage has now hit 8%, according to Mortgage News Daily. That number marks the highest level of rates in 23 years.

Mortgage rates have risen in the wake of the Federal Reserve's campaign to tighten monetary policy. The Fed has raised its target rate, which applies to a short-term market separate from the mortgage market, to a range of 5.25% to 5.50%.

It was also revealed this week that the number of housing starts ticked up in September despite high mortgage rates, another mixed signal from the housing market.

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Housing starts, the change in the number of new residential buildings that began construction, rose 7% from August to this past month, according to a Wednesday report from the Census Bureau. They are now at an annual rate of 1.358 million.

Meanwhile, new home sales fell 8.7% from July to August to a seasonally adjusted annual rate of 675,000, according to the Census Bureau.