U.S. Home Price Growth Hits Softest Rate Since Great Recession

• Year-over-year price growth continues its downward trend, with growth slowing to just 0.9% in December 2025.
• Midwest and Northeast hubs continue to show resilience. Newark, NJ, Allentown, PA, and Chicago, IL all saw annual price growth gain traction in December.
• Wyoming and New Jersey lead the nation with annual home price appreciation, far outperforming the cooling national average.

IRVINE, Calif.–(BUSINESS WIRE)–#HPI–Cotality, a leader in property information, analytics, and data-enabled solutions, released its Home Price Index for December 2025 data today. Home price growth slowed to 0.9% — one of the softest rates since the post-Great Recession recovery. The slowdown shows the market is rebalancing, and strong economic and housing fundamentals are necessary to support local housing demand.

“We are seeing a significant departure from the rapid surges of recent years; while the upward pressure on prices remains, the momentum has moderated enough to suggest that the market is finally becoming more navigable for prospective buyers,” said Cotality Chief Economist Dr. Selma Hepp.

While national growth remains soft, the Midwest and parts of the Northeast continue to do well because of their relative affordability, diversified job markets, and hybrid work dynamics. States like New Jersey (+5.5%), Illinois (+5.4%), Nebraska (+5.4%), and Connecticut (+5.1%) are among the nation’s strongest performers, with markets like Newark, NJ; Allentown, PA; and Chicago bucking the national cooling trend.

7 States reached new high home price growth as of December 2025

• New Jersey
• Pennsylvania
• Delaware
• Nebraska
• Louisiana
• Indiana
• Mississippi

On the other hand, negative home price growth is dominating the South and the West — including Florida, Texas, Colorado, Washington D.C., Hawaii, Arizona, Utah, Oregon, and California — mostly due to higher inventory levels and fewer people moving into once-hot markets.

While December’s data confirms that the U.S. housing market is entering a clear rebalancing phase, there are signs that the slowdown may be leveling off. In December, fewer of the top 100 metros recorded slowing appreciation compared to the previous year — 49 out of 100 compared to 77 earlier in the fall. Falling Mortgage rates, which are down 50 basis points since the summer, are helping stabilize the housing market.

The next Cotality Home Price Index will be released on March 3, 2026, featuring data for January 2026. 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.

Contacts

Media Contact
Charity Head
Cotality
newsmedia@corelogic.com