(Bloomberg) -- A gauge of pending sales of existing US homes fell to its lowest level on record in October, illustrating a resale market battered by high borrowing costs and prices.

The National Association of Realtors’ index of contract signings to purchase previously owned homes declined 1.5% to 71.4, the lowest in data back to 2001, the group reported Thursday. The median estimate in a Bloomberg survey of economists called for a 2% decrease.

“During October, mortgage rates were at their highest, and contract signings for existing homes were at their lowest in more than 20 years,” Lawrence Yun, NAR’s chief economist, said in a statement. “Recent weeks’ successive declines in mortgage rates will help qualify more home buyers, but limited housing inventory is significantly preventing housing demand from fully being satisfied.”

Pending home sales were down 6.6% from a year earlier on an unadjusted basis.

Mortgage rates near levels not seen since the early 2000s, combined with still-high prices and a lack of inventory are keeping would-be buyers on the sidelines. Activity has also been restrained by a lack of sellers as homeowners who locked in rates at much lower levels remain reluctant to list their properties.

By region, only the Northeast saw an increase in pending sales last month Sales fell the most in the West, down 6%, while contract signings in the South and Midwest slipped 1.9% and 0.4%, respectively. 

Home sales are rising in places with more inventory, Yun said, noting that purchases of new houses are up so far this year because of builders’ ability to create inventory.

--With assistance from Chris Middleton.

©2023 Bloomberg L.P.