U.S. home prices increased 1.4% on an adjusted basis in September compared with August and were up 1.3% compared with September 2024, according to the S&P Cotality Case-Shiller U.S. National Home Price NSA Index.
The 20 largest U.S. cities recorded month-over-month declines in home prices before seasonal adjustment in September, underscoring broad-based weakening as elevated mortgage rates weigh on affordability and demand.
“The housing market’s deceleration accelerated in September, with the National Composite posting just a 1.3 percent annual gain – the weakest performance since mid-2023,” says Nicholas Godec, CFA, CAIA,CIPM, head of fixed income tradables and commodities at S&P Dow Jones Indices, in the report. “This marks a continued slide from August’s 1.4 percent increase and represents a stark contrast to the double-digit gains that characterized the early post-pandemic era. National home prices continued trailing inflation, with September’s CPI running 1.7 percentage points ahead of housing appreciation. This marks the widest gap between inflation and home-price growth since the two measures diverged in June, with the spread continuing to widen each month.”
“Regional performance reveals a tale of two markets,” Godec says. “Chicago continues to lead with a 5.5 percent annual gain, followed by New York at 5.2 percent and Boston at 4.1 percent. These Northeastern and Midwestern metros have sustained momentum even as broader market conditions soften.”
“At the opposite extreme, Tampa posted a 4.1 percent annual decline – the sharpest drop among tracked metros and its 11th consecutive month of negative annual returns,” he says. “Phoenix, Dallas, and Miami likewise remained in negative territory, highlighting particular
weakness in Sun Belt markets that experienced the most dramatic pandemic-era price surges.”
“The geographic rotation is striking,” Godec adds. “Markets that were pandemic darlings – particularly in Florida, Arizona, and Texas – are now experiencing outright price declines. Meanwhile, traditionally stable metros in the Northeast and Midwest continue to post solid gains, suggesting a reversion to pre-pandemic patterns where job markets and urban fundamentals drive appreciation rather than migration trends and remote-work dynamics.”
Photo: Gustavo Zambelli