United States house prices grew by 2.9% year-over-year last quarter, according to the Federal Housing Finance Agency, but continued to underperform in June.
House prices were unchanged from the year’s first quarter, however. Prices rose by 1.9% year-over-year in June, their slowest pace in around two years, per the S&P Totality Case-Shiller Index.
“For the first time in years, home prices are failing to keep pace with broader inflation,” said Nicholas Godec, S&P Dow Jones Indices head of fixed income tradables and commodities. The Consumer Price Index rose by 2.7% from June 2024 to June 2025.
“What makes this deceleration particularly noteworthy is the underlying pattern: The modest 1.9% annual gain masks significant volatility, with the first half of the period showing declining prices (-0.6%) that were more than offset by a 2.5% surge in the most recent six months, suggesting the housing market experienced a meaningful inflection point around the start of 2025.”
House prices have risen in 46 states since the second quarter of 2024, with New York leading at 8.0%. Connecticut and New Jersey, also northeastern states, placed second and third.
The District of Columbia reported the largest price decline in that period, at 7.6%.
New York City also saw the highest gains of any metropolitan area in June. “This represents a complete reversal of pandemic-era patterns, where traditional industrial centers now outpace former darlings like Phoenix (-0.1%), Tampa (-2.4%), and Dallas (-1.0%),” said Godec.
Tampa saw the greatest drop in prices in June among major cities, at 2.4%. The worst-performing metropolitan area in the year to 2025’s second quarter was North Port-Bradenton-Sarasota, just south of Tampa.
Sales of new homes and residential construction approvals also dropped in the U.S. in July.
