U.S. home prices decreased -0.2% in September compared with August but were up 1.1% compared with September 2024, according to First American’s latest home price index report.
September marked the tenth straight month of slowing home price appreciation, according to the firm’s data.
“The housing market’s steadily unfolding cooldown has now reached 10 consecutive months of slowing annual price appreciation,” says Mark Fleming, chief economist at First American, in a statement. “Nationally, house prices are now 0.7 percent below their peak in May as demand adjusts to affordability constraints and inventory improves.”
“For buyers, who are often first sellers, today’s market offers more choices and greater negotiating power, as annual price appreciation slows to its slowest pace since 2012,” Fleming says.
Fleming notes that there is a large disparity among markets, with some still seeing strong gains in home prices while others are seeing ongoing depreciation. For example, home price growth remains strong in the Northeast and Midwest, while many Sun Belt markets have surrendered some of their pandemic boom era gains.
“House prices declined year over year in 19 of the 30 largest markets we track in September, demonstrating the broad downward shift in momentum,” he says. “Yet, this masks regional differences — strong house price growth in Cincinnati and steady growth in St. Louis, for example, while prices are still recalibrating after years of rapid growth in pandemic darlings like Phoenix and Tampa, Fla.”
The First American Data & Analytics HPI segments home price changes at the metropolitan level into three price tiers based on local market sales data: starter tier, which represents home sales prices at the bottom third of the market price distribution; mid-tier, which represents home sales prices in the middle third of the market price distribution; and the luxury tier, which represents home sales prices in the top third of the market price distribution.
Photo: Amanda Smith