As the spring homebuying season ended, U.S. home price growth softened significantly, opening the door to improved affordability. According to Cotality’s August 2025 U.S Home Price Insights report, annual growth in June dipped to 1.7%, now trailing well below the rate of inflation — a trend that signals modest real price gains and slightly easing pressure for buyers.
From May to June, prices rose just 0.1%, the slowest June uptick since 2008.
Some regions remained strong despite the national slowdown. The Northeast and Midwest were among the most resilient markets, as they saw seasonal price gains that aligned with pre-pandemic trends. In June, Connecticut (+7.8%), New Jersey (+7.2%) and Rhode Island (+6.6%) posted some of the nation’s highest annual price gains.
Notably, West Virginia also saw robust appreciation at 5.5%, placing it among the top five states for home price growth. By contrast, the Sun Belt states reported negative home price growth during the same period.
Despite the report illustrating that affordability is gradually improving, insurance premiums and property taxes have surged 70% since 2020.
Cotality Chief Economist Selma Hepp said, “With mortgage rates remaining elevated and concerns about a slowing U.S. economy, subdued demand and downward pressure on home prices is expected to persist, particularly in regions where prices have already decelerated or where recent appreciation has significantly limited local affordability.”
By June, the median sale price for a single-family home hit $403,000, still increasing but at a slower pace than inflation — signaling a tentative shift toward a buyer’s market, according to the report. Rents remain tight as well, with single-family rents rising 2.9% year-over-year in the Northeast, Midwest and Mid-Atlantic.
Hepp said, “Housing markets are currently undergoing a period of transition, with an increasing proportion of markets experiencing annual declines in home prices. In June, 20% of the 949 large and small metropolitan areas recorded price reductions — the highest percentage since 2012. However, this softness is primarily concentrated in southern and southeastern markets, including major metropolitan areas in Florida, Texas and the San Francisco Bay Area.”