Home Price Growth Cools in May

Home Price Growth Cools in May

Two measures of U.S. home prices recorded annual gains in May, but at slower rates than in April.

S&P Dow Jones Indices, New York, reported a 2.3% annual gain in May in the S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, down from a 2.7% annual gain in the previous month.

“May’s data continued the year’s slow unwind of price momentum, with annual gains narrowing for a fourth consecutive month,” said Nicholas Godec, head of fixed-income tradables & commodities at S&P Dow Jones Indices. “National home prices were just 2.3% higher than a year ago, the smallest increase since July 2023, and nearly all of that gain occurred in the most recent six months. The spring market lifted prices modestly, but not enough to suggest sustained acceleration.”

Godec said seasonal momentum is proving weaker than usual, “and the slowdown is now more than just a story of higher mortgage rates,” he concluded. “It reflects a market recalibrating around tighter financial conditions, subdued transaction volumes, and increasingly local dynamics. With affordability still stretched and inventory constrained, national home prices are holding steady, but barely.”

The Federal Housing Finance Agency, Washington, D.C., reported similar figures in its seasonally adjusted monthly House Price Index. FHFA calculated that U.S. house prices fell 0.2% in May but rose 2.8% from May 2024 to May 2025.

FHFA noted seasonally adjusted monthly home price changes ranged from -0.8% in the Middle Atlantic census division to +0.3% in the West South Central and New England census divisions. The 12-month changes were all positive, ranging from +0.6% in the Pacific division to +5.9% in the Middle Atlantic division.