U.S. Home Prices Stagnate in 2025 as Market Balances
Event summary
- National house prices in the U.S. saw just 0.5% year-over-year growth in December 2025, the slowest pace since 2012.
- Month-over-month, prices declined 0.2% from November to December 2025.
- 20 out of 30 top markets tracked showed flat or declining prices, with pandemic boom towns like Austin and Phoenix seeing notable adjustments.
- Northeast and Midwest markets, where supply remains tighter, posted the strongest gains.
- Starter home prices in Warren, Mich., rose 6.9% year-over-year, the highest increase among tracked metros.
The big picture
The U.S. housing market appears to have reached a more balanced state after years of volatility, with affordability gradually improving as price growth lags behind income gains. The data suggests a shift from pandemic-era boom conditions to a more supply-driven market, particularly in areas where remote work trends accelerated demand. First American's report highlights the growing divide between markets with constrained inventory and those where supply is normalizing.
What we're watching
- Inventory Dynamics
- How rising inventory in pandemic boom towns will affect price corrections in 2026.
- Regional Disparities
- Whether Northeast and Midwest markets can sustain price growth amid tighter supply.
- Affordability Trends
- The pace at which household income growth outpaces price appreciation in key markets.
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