Cotality, a provider of property information and analytics, announced today that its Home Price Index™ for August 2025 recorded a 1.3% year-over-year price growth, as home sales activity continued at multi-decade lows, though overall affordability has seen its most favorable level since 2022.
The report detailed significant regional variations in home price appreciation. Northeastern states led with home price growth ranging from 6% to 7% compared to the previous year. In contrast, several areas in the South and West experienced negative price growth in August, including Florida, Washington D.
C., Colorado, Hawaii, Arizona, Texas, and California. Concurrently, median home price increases have decelerated, with the U.
S. median home price slightly decreasing to $400,000.
Lower home prices, slower appreciation rates, and a recent decrease in mortgage rates have contributed to enhanced affordability, reaching its most favorable point since mortgage rates began rising in 2022. Dr. Selma Hepp, Cotality Chief Economist, commented on this trend, stating, “Enhanced affordability has provided much-needed relief to the housing market, which has experienced limited momentum over the past two years.” She added that recent increases in mortgage application activity suggest homebuyers are gradually returning to the market, benefiting from rising inventories and more common price reductions in certain local markets, which is shifting negotiating power towards buyers.
Dr. Hepp further elaborated on the current state of the market: “The housing market remains at a crossroads—where mortgage rates, inventory shifts, local dynamics, and policy decisions converge. Whether demand unlocks further or stalls will depend not just on market and economic fundamentals, but perhaps, most crucially, on consumer sentiment which remains fragile particularly when it comes to job security and financial prospects. Until buyers feel confident in both the market and their own financial footing, many will remain on the sidelines.” The report also indicated a slowdown in the weakening across the number of markets, with fewer metros recording year-over-year declines in August compared to July. Notably, San Francisco’s price growth has reaccelerated since spring, driven by the AI boom and a resurgence of demand.
Cotality, which specializes in property information, analytics, and data-enabled solutions, builds its HPI™ on public record, servicing, and securities real-estate databases, incorporating over 45 years of repeat-sales transactions. The company’s offerings also include Cotality HPI Forecasts™, Market Risk Indicators, and Market Condition Indicators, which provide insights into market health and valuation. The next Cotality Home Price Index, featuring data for September 2025, is scheduled for release on November 4.
