Homes.com released a new report indicating that U.S. home price increases slowed for the fifth consecutive month in May 2025. The national median home price rose modestly by 1.0% year-over-year, a further deceleration from April's 1.3% growth rate.
The median home price increased by $3,829 from May of last year, reaching $388,829. While prices have increased for 23 consecutive months on a year-over-year basis, the rate of increases peaked at 5.6% in the second half of 2024, indicating a significant cooling trend.
May data also showed that the inventory of homes for sale increased 17.2% compared to May 2024, reaching its highest level since October 2019. This rise in inventory and softening price pressures suggest a transition towards a buyer’s market, particularly in several Sun Belt metros, although affordability remains challenging due to elevated mortgage rates.
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