In June, home prices grew at their weakest rate since 2023, falling below the rate of inflation, a report found — the latest sign of a downturned housing market.
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National home prices in June were up only 1.9% year-over-year, according to the S&P Cotality Case-Shiller Index published Tuesday. This marks the slowest pace since the summer of 2023, Nicholas Godec, head of fixed income tradables and commodities at S&P Dow Jones Indices, said in a release.
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“For the first time in years, home prices are failing to keep pace with broader inflation,” Godec said.
The Consumer Price Index grew 2.7% from June 2024 to June 2025, while national home prices rose 1.9%, he added, saying the change is “historically significant.”
This decline is reflective of the housing market’s “new equilibrium” as the market adjusts to an economy where consumers are still battling high inflation, high — albeit falling — mortgage rates, rising costs due to tariffs, and a weak job market.
As these factors, among others, have pushed buyers away, the market has responded by lowering mortgage rates and slowing price growth. In July, existing home sales in the U.S. grew by 2% thanks to these changes, according to the National Association of Realtors.
The median existing-home price was $422,400 in July, up 0.2% from one year ago.
But even with these gains in July, yearly data from June 2025 to June 2024 shows a market in decline.
After seasonal adjustment, the national housing price index fell 0.3% in June, which suggests that “underlying housing demand remains weak,” Godec said.
“Looking ahead, this housing cycle’s maturation appears to be settling around inflation-parity growth rather than the wealth-building engine of recent years,” he added.
This shift can be seen at the metro level as well.
Traditional industrial centers are seeing better housing price gains than “former darlings” that performed well during the pandemic — like Tampa, Phoenix, and Dallas — because they offer more “sustainable fundamentals” like employment growth, relative affordability, and demographic shifts, Godec said.
“While this represents a loss of the extraordinary gains homeowners enjoyed from 2020-2022, it may signal a healthier long-term trajectory where housing appreciation aligns more closely with broader economic fundamentals than speculative excess,” he said.
— Niamh Rowe contributed to this article.