First American Data & Analytics, a division of First American Financial Corporation (NYSE: FAF), has released its May 2025 Home Price Index (HPI) report, which tracks home price changes less than four weeks behind real time at national, state, and metropolitan levels.
The report indicates a stabilization in national home price appreciation, with the national HPI showing a 0.4 percent month-over-month increase and a 2.1 percent year-over-year increase. This follows 16 consecutive months of deceleration in national house prices. Mark Fleming, chief economist at First American, stated that rising mortgage rates in April and May reduced affordability and tempered demand, while an increase in home supply contributed to the slowest annual appreciation rate since 2012. Fleming noted that slower national price appreciation can help household incomes offset some of the impact of elevated mortgage rates, benefiting potential buyers.
In the Dallas-Plano-Irving metropolitan area, the HPI declined by 0.5 percent month-over-month and 1.3 percent year-over-year. The report further segments home price changes at the metropolitan level into three price tiers: starter (bottom third of market price distribution), mid-tier (middle third), and luxury (top third). For Dallas-Plano-Irving from May 2024 to May 2025, the starter tier saw a 0.2 percent increase, while the mid-tier decreased by 0.1 percent and the luxury tier by 0.5 percent.
Despite the national slowdown, Fleming highlighted that price appreciation exceeded the national pace in 11 of the 30 tracked markets, with the fastest appreciation occurring in the Northeast and Midwest, specifically Cambridge, Mass., Pittsburgh, Cincinnati, St. Louis, and New York. Conversely, some Southern and Western markets experienced flat or declining prices. Fleming noted that these declines were small relative to equity gained during the pandemic, citing Tampa, Fla., where prices fell 4 percent annually but had increased 70 percent from pre-pandemic levels to their peak.
Highlights from the May 2025 report include the following Core-Based Statistical Areas (CBSAs) ranked by year-over-year increases in Starter Tier HPI:
* Austin, Texas: +12.0 percent (Starter), +2.0 percent (Mid-Tier), -5.0 percent (Luxury)
* Cambridge, Mass.: +9.5 percent (Starter), +3.8 percent (Mid-Tier), +4.8 percent (Luxury)
* Pittsburgh: +8.6 percent (Starter), +3.0 percent (Mid-Tier), +5.8 percent (Luxury)
* Warren, Mich.: +5.8 percent (Starter), +3.3 percent (Mid-Tier), +2.8 percent (Luxury)
* Washington: +3.2 percent (Starter), +2.4 percent (Mid-Tier), +1.7 percent (Luxury)
CBSAs with the greatest overall year-over-year increases in HPI included Cambridge, Mass. (+6.0 percent), Pittsburgh (+5.7 percent), Cincinnati (+5.6 percent), St. Louis (+5.4 percent), and New York (+4.6 percent).
Conversely, CBSAs experiencing a year-over-year decrease in HPI were Oakland, Calif. (-7.4 percent), Tampa, Fla. (-4.1 percent), San Diego (-2.0 percent), Denver (-1.9 percent), and Orlando, Fla. (-1.7 percent).
First American Data & Analytics’ HPI report measures single-family home prices, including distressed sales, with indices updated monthly since 1980. Data is provided at national, state, and CBSA levels, including preliminary estimates for the prior month, which are subject to revision. The HPI employs a repeat-sales methodology, analyzing price changes for the same property over time using over 46 million paired transactions. In non-disclosure states, the HPI integrates public sales records, MLS sold and active listings, and appraisal data to estimate house prices. Property type, price, and location data are utilized for refined market segment indices. Real Estate-Owned (REO) transactions are not included.
The full report is available on the First American Data & Analytics website, with the next HPI release scheduled for the week of July 14, 2025.
