US home price insights — November 2025

National home price growth

September 2025 data

Source: Cotality

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Affordability meter

Source: Cotality

Insights from Chief Economist Dr. Selma Hepp

The U.S. housing market is continuing to cool off as summer fades into fall. Home prices across the country are starting to sag as inventory reaches its highest level since 2019. While the Northeast is still showing strong market signals, other regional differences are becoming apparent.

Northeastern states are maintaining strong housing fundamentals, which has led to continued home price growth in the high single digits. However, western states like Alaska and Wyoming are showing a turnaround and posted home price growth this month. Both states had year-over-year gains above 5%. However, at the metro level, more areas are seeing depressed prices. In September, 20% of the 411 U.S. metropolitan areas saw annual price drops. This is the largest share of metros with declines in price growth since June 2023 when surging mortgage rates significantly cooled home prices.

“Much like the K-shaped trend seen in overall consumer spending—driven largely by higher income groups—lower-income potential homebuyers are facing challenges due to an uncertain job market, sluggish wage growth, and worsening financial conditions. This is leading to weaker demand for homes and downward pressure on prices,” said Cotality’s Chief Economist Dr. Selma Hepp.

Amid falling prices, there has been a rise in serious mortgage delinquencies in some states like Florida, a state where a large proportion of markets are experiencing ebbing prices. These lower prices reduce the amount of equity that homeowners can tap into even as escrow costs climb. People are paying an average of 45% more in escrow costs compared with five years ago, and that is pushing up monthly payments past the point of affordability. The increasing cost of owning a home has in part led to properties spending longer on the market and deals being more difficult to close despite for-sale inventory growing.

Although recent declines in mortgage rates and the moderation in housing prices have slightly improved affordability, cost continues to be the primary obstacle for many prospective homebuyers. Notably, 75% of the top 100 housing markets are still considered overvalued, according to Cotality’s HPI. Also, while more for-sale homes offer more options, the 72% increase in real mortgage payments (exclusive of insurance and taxes) puts homeownership out of reach for many.  

“Major Northeastern metro areas such as Boston, New York, and Philadelphia remain resilient thanks to sectors like finance, biotech, healthcare, and education. Strong and diversified local job markets continue to draw high-earning professionals and give them the income stability needed to purchase expensive homes. Additionally, many of these regions have nearby, mid-sized metros that are more affordable; these areas are increasingly popular with hybrid workers and high-income commuters seeking better value. Although recent declines in mortgage rates have provided support for housing activity, broader improvements in demand will depend on the strength of the labor market and corresponding consumer confidence.”

-Dr. Selma Hepp

Cotality’s Chief Economist