Home prices are cooling this spring led by a softer condo market
Amid heightened uncertainty, ICE's same-month Home Price Index offers insights that are weeks ahead of rival benchmarks with no lag
Andy Walden
Home price growth is cooling as the spring homebuying season kicks off, with improved inventory supporting a softer price dynamic, especially in the Sunbelt and among condos. Yet concerns around inflation, employment and a volatile policy landscape are triggering fresh uncertainty, causing consumer sentiment to fall for a fourth consecutive month in April to the lowest level since July 2022.
Against this backdrop, timely data is paramount for market participants to make sense of real estate dynamics. That’s why ICE has enhanced its Home Price Index (HPI) to deliver insights without a lag that are weeks ahead of other industry benchmarks. This means market participants can access same-month home price trends via a mid-month update.
An early look at April HPI data shows some interesting trends. First, home price growth shows clear signs of cooling. The annual growth rate has decelerated to +1.9% in April from +3.5% at the start of the year, marking the slowest home price growth in nearly two years, as modestly improved demand is running up against higher levels of inventory in nearly every major market. All in, 99 of the 100 largest U.S. markets have seen home price growth slow through the first four months of the year, with nearly three-quarters of markets now seeing home price growth running below long-run averages. While home prices are still edging higher in the Northeast and Midwest, the highest rate of growth in any major market is now +7.3% (in Bridgeport, Conn.), marking the lowest ‘ceiling’ we’ve seen in the market since 2012. In roughly 20% of markets, home prices were down year-over-year in April, providing much needed relief for prospective homebuyers.
Source: ICE
Second, after largely mirroring single family residences (SFR) in 2023, the condo market has diverged and is seeing outsized weakening in recent quarters. Condo prices rose by just +1.2% in 2024, roughly one-third the rate (+3.8%) of SFRs. And early April data shows condo prices are now down 0.4% from the same time last year, slipping into negative territory for the first time in more than a decade. This holds especially true in Florida where 27 of the state’s 28 metropolitan areas saw condo prices decline from the same time last year, with condos underperforming single family homes in all 28 markets (in some cases by as much as nine percentage points).
A variety of factors have contributed to the softening condo market. In 2024, an influx of multifamily unit completions increased inventory and rental alternatives, while growing condo regulations, rising property insurance costs, and insurability challenges — especially in areas impacted by Hurricanes Helene and Milton — have added additional strain. These factors, along with more traditional market dynamics, have led to softening condo prices as the housing market begins to cool.
In Florida markets like Punta Gorda that were hardest hit by last year’s hurricanes, condo prices fell 13.3% YoY, while neighboring coastal markets like Fort Myers, Sarasota and Arcadia experienced declines ranging from 9% to 10%. That said, softer condo prices aren’t just being seen in Florida. Nearly half of major markets are seeing condo prices down from the same time last year, with declines of 5% or more being seen in Stockton, Colorado Springs, Denver, Little Rock and Memphis — and more modest declines seen in markets across the Sunbelt, up through the northwestern regions of the country.
Source: ICE
To release its HPI to market faster, ICE has added new datasets and refined the index models to include closed sales from MLS and daily loan-level servicer-contributed information, which enables it to provide more accurate pricing with data from non-disclosure states.
This helps provide more frequent insights — and data on price shifts — in an environment that continues to evolve. Against a backdrop characterized by buyer anxiety and macroeconomic uncertainty, timely data has never been more relevant.