• Year-over-year price growth dipped to 1.4% in July 2025. This is almost half the rate of inflation recorded in the Consumer Price Index that month.
• Monthly price increases have been nominal this year and were in negative territory (down 0.2%) between June and July 2025.
• South Dakota saw prices rise 6.2% year-over-year, entering the top 5 states with the highest home price growth. The full list includes New Jersey, South Dakota, Connecticut, Rhode Island, and West Virginia, all of which continue to record more than triple the national rate of price growth.
• Florida, Texas, Montana, and Washington D.C. reported negative home price growth.

Cotality™, a leader in property information, analytics, and data-enabled solutions, released its Home Price Index™ for July 2025 today. In July, price growth dipped to 1.4%, which is well below the 2.7% rate of inflation recorded in the Consumer Price Index during that same period. However, the national average glosses over pockets of growth around the U.S.

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Chart 1: National home price growth. July 2025 data. Source: Cotality

There are some markets, particularly in the Northeast and in the Midwest, where housing fundamentals remain strong and are supporting continued home price increases. States like West Virginia and South Dakota remain attractive thanks to their relative affordability. This is influencing people to move into these states which, in turn, is pushing up prices. West Virginia and South Dakota saw home prices rise 5.7% and 6.2%, respectively.

“July’s decline in home prices is atypical — the last two periods where we saw monthly declines in July was in 2022 and during 2006-2008 period — but this year’s decline follows a year of relatively flat home prices and persistent weakness in homebuying demand,” Cotality’s Chief Economist Dr. Selma Hepp explained. “And even though price weakness has spread across more markets, 50% continue to see prices increase. The markets where prices are increasing tend to be more affordable markets in Midwest, such as the Chicago metro; Indianapolis; Cleveland; Tulsa, OK; and Louisville, KY; as well as Philadelphia and the New York metro. At the same time, Florida markets and those in the West continue to see persistent price declines.”

Across the nation, for-sale inventory is growing. While this is providing more options for buyers to choose from, affordability still remains a hurdle for many. Homebuyers need an additional $200,000 compared to 10 years ago to close on a median-priced home, Cotality data found. Still, the number of pending sales is increasing compared to last year. However, these deals are more difficult to close, and sometimes even fall through, as buyers and sellers struggle with differing expectations.

Some markets like Los Angeles and Washington D.C. are seeing more homes sell below asking price. These two markets also saw overall home prices decline. Los Angeles recorded a –0.03% drop from June to July 2025 while Washington D.C. saw a –0.2% drop from July 2024 to July 2025. In July, home prices fell in half of the 100 largest metro areas. Typically, prices rise by an average of 0.4% in July, according to Cotality data from 2015 to 2019.

These recent price dips are incentivizing investors. Investor activity remains elevated this year when compared to previous years, with investors making about one-third of total home purchases across the U.S. The higher share of investor purchases in the market is largely due to a decline in owner-occupied transactions, and these elevated levels are expected to remain steady through the end of 2025.

While price increases have moderated, home costs continue to rise, with this month’s median sales price for single-family homes reaching $405,000. Although the national median remains elevated, the pace of home price appreciation is currently trailing inflation. Consequently, housing affordability is gradually improving, providing more prospective buyers an opportunity to enter the property market.

“While housing market expectations remain influenced by the availability of for-sale inventory and affordability concerns, the recent decline in mortgage rates may counteract the general price weakness observed this summer. Mortgage rates are currently at their lowest point since last September when a similar decrease stimulated increased demand for home purchases. Taken together, the lower mortgage rates and lower home prices in many markets suggest improved affordability for a number of buyers who have been sitting on the sidelines for a long time.”

The next Cotality Home Price Index will be released on October 7, featuring data for August 2025. For ongoing housing trends and data, visit the Cotality Insights blog: www.cotality.com/insights.

Methodology

The Cotality HPI™ is built on industry-leading public record, servicing and securities real-estate databases and incorporates more than 45 years of repeat-sales transactions for analyzing home price trends. Generally released on the first Tuesday of each month with an average five-week lag, the Cotality HPI is designed to provide an early indication of home price trends by market segment and for the Single-Family Combined tier, representing the most comprehensive set of properties, including all sales for single-family attached and single-family detached properties. The indices are fully revised with each release and employ techniques to signal turning points sooner. The Cotality HPI provides measures for multiple market segments, referred to as tiers, based on property type, price, time between sales, loan type (conforming vs. non-conforming) and distressed sales. Broad national coverage is available from the national level down to ZIP Code, including non-disclosure states.

Cotality HPI Forecasts™ are based on a two-stage, error-correction econometric model that combines the equilibrium home price—as a function of real disposable income per capita—with short-run fluctuations caused by market momentum, mean-reversion, and exogenous economic shocks like changes in the unemployment rate. With a 30-year forecast horizon, Cotality HPI Forecasts project Cotality HPI levels for two tiers — Single-Family Combined (both attached and detached) and Single-Family Combined Excluding Distressed Sales. As a companion to the Cotality HPI Forecasts, Stress-Testing Scenarios align with Comprehensive Capital Analysis and Review (CCAR) national scenarios to project five years of home prices under baseline, adverse and severely adverse scenarios at state, metropolitan areas and ZIP Code levels. The forecast accuracy represents a 95% statistical confidence interval with a +/- 2% margin of error for the index.

About Market Risk Indicators

Market Risk Indicators are a subscription-based analytics solution that provide monthly updates on the overall health of housing markets across the country. Cotality data scientists combine world-class analytics with detailed economic and housing data to help determine the likelihood of a housing bubble burst in 392 major metros and all 50 states. Market Risk Indicators is a multi-phase regression model that provides a probability score (from 1 to 100) on the likelihood of two scenarios per metro: a >10% price reduction and a ≤ 10% price reduction. The higher the score, the higher the risk of a price reduction.

About the Market Condition Indicators

As part of the Cotality HPI and HPI Forecasts offerings, Market Condition Indicators are available for all metropolitan areas and identify individual markets as overvalued, at value or undervalued. These indicators are derived from the long-term fundamental values, which are a function of real disposable income per capita. Markets are labeled as overvalued if the current home price indexes exceed their long-term values by greater than 10% and undervalued where the long-term values exceed the index levels by greater than 10%.

Source: Cotality

The data provided are for use only by the primary recipient or the primary recipient's publication or broadcast. This data may not be resold, republished or licensed to any other source, including publications and sources owned by the primary recipient's parent company without prior written permission from Cotality. Any Cotality data used for publication or broadcast, in whole or in part, must be sourced as coming from Cotality, a data and analytics company. For use with broadcast or web content, the citation must directly accompany first reference of the data. If the data are illustrated with maps, charts, graphs or other visual elements, the Cotality logo must be included on screen or website. For questions, analysis or interpretation of the data, contact Charity Head at newsmedia@Cotality.com. Data provided may not be modified without the prior written permission of Cotality. Do not use the data in any unlawful manner. The data are compiled from public records, contributory databases and proprietary analytics, and its accuracy is dependent upon these sources.

About Cotality

Cotality accelerates data, insights, and workflows across the property ecosystem to enable industry professionals to surpass their ambitions and impact society. With billions of real-time data signals across the life cycle of a property, we unearth hidden risks and transformative opportunities for agents, lenders, carriers, and innovators. Get to know us at www.cotality.com.

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"Lower mortgage rates and home prices in many markets suggest improved affordability for a number of buyers who have been sitting on the sidelines for a long time." -Dr. Selma Hepp, Cotality Chief Economist