National House Price Growth Sinks to Slowest Pace Since Summer 2023, According to First American Data & Analytics Monthly Home Price Index Report

Rhea-AI Summary

First American Data & Analytics released its January 2025 Home Price Index (HPI) report, revealing the slowest national house price growth since June 2023. The report shows a modest month-over-month increase of 0.1% and a year-over-year growth of 3.3%.

House prices are now 54.8% higher than pre-pandemic levels. Chief Economist Mark Fleming attributes the slowdown to elevated mortgage rates reducing buyer purchasing power and increasing inventory levels. The luxury market segment showed particular strength, with price growth in 25 of 28 tracked markets.

Among metropolitan areas, St. Louis and Cambridge, Mass. led with the highest year-over-year increases at 4.6%, while Oakland, Calif. and Tampa, Fla. showed the largest decreases at -3.8%. The luxury tier demonstrated notable performance, with Cambridge, Las Vegas, and Washington showing the strongest growth in this segment.

—Much like the groundhog seeing its shadow, we expect the housing winter to persist in the face of elevated mortgage rates, says Chief Economist Mark Fleming—

SANTA ANA, Calif.--(BUSINESS WIRE)-- First American Data & Analytics, a leading national provider of property-centric information, risk management and valuation solutions and a division of First American Financial Corporation (NYSE: FAF), today released its January 2025 Home Price Index (HPI) report. The report tracks home price changes less than four weeks behind real time at the national, state and metropolitan (Core-Based Statistical Area) levels and includes metropolitan price tiers that segment sale transactions into starter, mid and luxury tiers. The full report can be found here.

January¹ National House Price Index

First American Data & Analytics’ National Non-Seasonally Adjusted (NSA) HPI
Metric	Change in HPI
December 2024-January 2025 (month over month)	+0.1 percent
January 2024-January 2025 (year over year)	+3.3 percent

Highlights

• House prices nationally are now 54.8 percent higher compared to pre-pandemic levels (February 2020).
• House price growth reported in last month’s HPI for November 2024 to December 2024 was revised down by 0.1 percentage points, from +0.1 percent to 0.0 percent.

Chief Economist Analysis:

“National house price growth slipped to the slowest pace since June 2023 amid elevated mortgage rates and rising inventories,” said Mark Fleming, chief economist at First American. “Elevated mortgage rates reduce house-buying power for potential buyers, holding back demand. At the same time, inventory levels are increasing as some potential sellers list their homes for sale after coming to terms with ‘higher-for-longer’ rates and more new-home completions hit the market, further dampening price growth. Much like the groundhog seeing its shadow, we expect this ‘housing winter’ to persist if mortgage rates remain high while inventories keep climbing.”

January 2025 Local Market Price Tier Highlights

The First American Data & Analytics HPI segments home price changes at the metropolitan level into three price tiers based on local market sales data: starter tier, which represents home sales prices at the bottom third of the market price distribution; mid-tier, which represents home sales prices in the middle third of the market price distribution; and the luxury tier, which represents home sales prices in the top third of the market price distribution.

“The luxury price tier stands out as a relative outperformer when measuring annual house price growth by tier and market. Prices in the luxury tier grew in 25 of the 28 markets we tracked this month, outpacing price growth in the mid- and starter tier segments,” said Fleming. “Luxury home buyers, less affected by the lock-in effect due to their ability to pay in cash, are playing a different game. In December’s existing-home sales report, the boom in sales was most distinct at the upper end of the market as sales of homes priced at more than $1 million jumped 35 percent nationally, followed closely by homes in the $750,000-$1 million range, which spiked 33 percent. Existing homeowners are playing ‘housing musical chairs’ by selling to each other, a dynamic that is keeping luxury price growth strong in many markets.”

January 2025 First American Data & Analytics Price Tier HPI Highlights²

Core-Based Statistical Areas (CBSAs) Ranked by Greatest Year-Over-Year Increases in Luxury Tier HPI
CBSA	Change in Starter Tier HPI	Change in Mid-Tier HPI	Change in Luxury Tier HPI
Cambridge, Mass.	+2.5 percent	+9.1 percent	+6.4 percent
Las Vegas	+1.2 percent	+4.7 percent	+6.3 percent
Washington	+1.1 percent	+3.9 percent	+5.7 percent
Atlanta	+1.2 percent	+2.0 percent	+4.8 percent
St. Louis	+5.6 percent	+3.9 percent	+4.8 percent

Additional January 2025 First American Data & Analytics HPI Highlights

Core-Based Statistical Areas (CBSAs) with Greatest Year-Over-Year Increases in HPI
CBSA	Change in HPI
St. Louis	+4.6 percent
Cambridge, Mass.	+4.6 percent
Anaheim, Calif.	+4.4 percent
Minneapolis	+4.3 percent
Las Vegas	+4.3 percent
Core-Based Statistical Areas (CBSAs) with a Year-Over-Year Decease in HPI
Oakland, Calif.	-3.8 percent
Tampa, Fla.	-3.8 percent
Los Angeles	-1.9 percent
San Diego	-0.9 percent
Orlando, Fla.	-0.6 percent

HPI data for all 50 states and the largest 30 CBSAs by population is available here.

Visit the First American Economic Center for more research on housing market dynamics.

Next Release

The next release of the First American Data & Analytics House Price Index will take place the week of March 17, 2025.

First American Data & Analytics HPI Methodology

The First American Data & Analytics HPI report measures single-family home prices, including distressed sales, with indices updated monthly beginning in 1980 through the month of the current report. HPI data is provided at the national, state and CBSA levels and includes preliminary index estimates for the month prior to the report (i.e. the preliminary result of July transactions is reported in August). The most recent index results are subject to revision as data from more transactions become available.

The HPI uses a repeat-sales methodology, which measures price changes for the same property over time using more than 46 million paired transactions to generate the indices. In non-disclosure states, the HPI utilizes a combination of public sales records, MLS sold and active listings, and appraisal data to estimate house prices. This comprehensive approach is particularly effective in areas where there is limited availability of accurate sale prices, such as non-disclosure states. Property type, price and location data are used to create more refined market segment indices. Real Estate-Owned transactions are not included.

Disclaimer

Opinions, estimates, forecasts and other views contained in this page are those of First American’s Chief Economist, do not necessarily represent the views of First American or its management, should not be construed as indicating First American’s business prospects or expected results, and are subject to change without notice. Although the First American Economics team attempts to provide reliable, useful information, it does not guarantee that the information is accurate, current or suitable for any particular purpose. © 2025 by First American. Information from this page may be used with proper attribution.

About First American Data & Analytics

First American Data & Analytics, a division of First American Financial Corporation, is a national provider of property-centric information, risk management and valuation solutions. First American maintains and curates the industry’s largest property and ownership dataset that includes more than 8.6 billion document images. Its major platforms and products include: DataTree^®, FraudGuard^®, RegsData^®, First American TaxSource™ and ACI^®. Find out more about how First American Data & Analytics powers the real estate, mortgage and title settlement services industries with advanced decisioning solutions at www.FirstAmDNA.com.

About First American

First American Financial Corporation (NYSE: FAF) is a premier provider of title, settlement and risk solutions for real estate transactions. With its combination of financial strength and stability built over more than 135 years, innovative proprietary technologies, and unmatched data assets, the company is leading the digital transformation of its industry. First American also provides data products to the title industry and other third parties; valuation products and services; mortgage subservicing; home warranty products; banking, trust and wealth management services; and other related products and services. With total revenue of $6.1 billion in 2024, the company offers its products and services directly and through its agents throughout the United States and abroad. In 2024, First American was named one of the 100 Best Companies to Work For by Great Place to Work^® and Fortune Magazine for the ninth consecutive year, and named one of the 100 Best Workplaces for Innovators by Fast Company for the second consecutive year. More information about the company can be found at www.firstam.com.

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¹ The most recent index results are subject to revision as data from more transactions become available.
² Note: Nassau-County-Suffolk County, NY and Pittsburgh are excluded from this month’s report due to data disruptions.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250218438002/en/

Media Contact:

Marcus Ginnaty

Corporate Communications

First American Financial Corporation

(714) 250-3298

Investor Contact:

Craig Barberio

Investor Relations

First American Financial Corporation

(714) 250-5214

Source: First American Data & Analytics

FAQ

What was the national house price growth rate for FAF's January 2025 HPI report?

The national house price growth showed a 0.1% month-over-month increase and a 3.3% year-over-year increase in January 2025.

Which cities showed the highest home price increases in January 2025 according to FAF?

St. Louis and Cambridge, Massachusetts led with the highest year-over-year increases, both at 4.6%, followed by Anaheim, California at 4.4%.

How much have house prices increased since pre-pandemic levels according to FAF?

House prices are 54.8% higher compared to pre-pandemic levels (February 2020).

Which markets showed the largest price decreases in January 2025?

Oakland, California and Tampa, Florida showed the largest decreases at -3.8%, followed by Los Angeles at -1.9%.

How did the luxury home market perform in FAF's January 2025 report?

The luxury tier showed strong performance, with price growth in 25 of 28 tracked markets, outpacing both mid-tier and starter tier segments.

What factors are contributing to the slowdown in house price growth according to FAF?

Elevated mortgage rates reducing buyer purchasing power and increasing inventory levels are the main factors contributing to the slowdown in house price growth.