S&P Global, the Federal Housing Finance Agency and Redfin all released housing reports on Tuesday, revealing fracturing pricing trends and the market’s struggle to settle into a new normal.
The housing market is filled with landmines, keeping homebuyers on their toes, hoping they’ll luck up on the right listing at the right price and, if the real estate gods are especially gracious, during a week where mortgage rates have eased enough to boost their buying power.
The S&P CoreLogic Case-Shiller Index and the Federal Housing Finance Agency’s (FHFA) House Price Index were both released on Tuesday, highlighting the market’s struggle to regulate amid multiple headwinds:
- The December Case-Shiller Index showed home prices rose 1.3 percent year over year, down from November’s 1.4 percent annual growth.
- Home prices only rose 1.3 percent year over year for the full year 2025 — the slowest gain since 2011, when prices fell 3.9 percent. The year’s performance is below the 10-year average of 6.6 percent growth.
- Real home price returns were negative in the second half of the year, as annual inflation outpaced home price growth at 2.7 percent.
- The FHFA’s HPI was a little brighter, with fourth-quarter U.S. home prices rising 1.8 percent year over year.
- However, on a month-over-month basis, the FHFA said home prices barely squeezed out a gain — only increasing 0.1 percent from November to December.
- Forty-one of 50 states saw home prices increase in Q4, with North Dakota (+6.4 percent), Delaware (+6.3 percent), Illinois (+6.1 percent), Wisconsin (+5.7 percent) and Michigan (+5.5 percent) leading the way.
Anthony Smith | Realtor.com
Realtor.com Senior Economist Anthony Smith commented on Case-Shiller’s results, saying pricing trends “represent a clear downshift from the post-pandemic pace” and “underscore how affordability constraints and historically low turnover weighed on housing momentum throughout the year.”
“Recent housing activity underscores that stabilization is occurring from a low base rather than signaling a broad rebound. Existing-home sales for 2025 totaled just 4.063 million, the lowest annual level since 1995, reflecting the persistence of rate lock-in,” he said in an email to Inman. “At the same time, national inventory has more than doubled since early 2022, yet price levels have remained resilient. Longer days on market and elevated delistings, rather than widespread price capitulation, explain much of this resilience.”
“Sellers, in many cases, appear more willing to withdraw listings than materially reset pricing expectations, keeping supply from exerting stronger downward pressure,” he added.
Homebuyers are withdrawing in record numbers as well, with 40,000 home-sale agreement cancellations in January, according to Redfin on Tuesday. That’s equal to 13.7 percent of homes that went under contract that month, the highest January share since Redfin began tracking the metric in 2017.
Cancellations were highest in markets tilting towards buyers, like San Antonio (21.2 percent), Atlanta (18.5 percent), and Cleveland (17.9 percent). Riverside, California (17.5 percent), and Orlando, Florida (17.3 percent).
“Sales are falling through at a higher rate than in the past, largely because it’s a buyer’s market, with hundreds of thousands more U.S. home sellers than buyers,” the report read. “That gives buyers negotiating power; they may back out during the inspection period if they see a home they like better or an inspection issue arises.”
“Another major reason buyers are backing out of deals is financial uncertainty,” it added. “While housing costs have come down from their peak, they are still near historic highs. Some would-be buyers are canceling purchases because they’re getting jittery about buying a house when they’re anxious about things like layoffs, tariffs, and geopolitical tensions.”
