Cotality, a leader in property information, analytics, and data‑enabled solutions, today released its Home Price Index™ with August 2026 data. National single-family home price growth reaccelerated modestly in August 2026, rising 1.8% year-over-year compared to 1.6% in July.
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National home price growth reaccelerated modestly in August 2026, rising 1.8% year-over-year. Source: Cotality, 2026
After the jump in mortgage rates in August, Cotality has seen the housing market continue to slow, with buyer pullback evident in September’s pending home sales. The trend is reflected in the HPI forecast, which predicts month-over-month price declines through the winter and lower annual gains. Overall, annual appreciation for 2026 is expected to reach 1.3%. Beneath this headline figure, however, the real estate landscape remains deeply divided due to persistent rate-lock constraints, shifting migration patterns, and localized inventory imbalances.
“Looking ahead to 2027, mortgage rates will be the primary driver of home price trends and sales activity,” said Dr. Selma Hepp, chief economist at Cotality. “Many buyers halt their searches when rates exceed 7%, but as expectations shift from lower rates in 2027 to ‘higher for longer,’ some may opt to buy rather than keep waiting. Although, elevated rates and ongoing affordability challenges will favor markets with lower entry prices and strong local job growth over former high-growth pandemic hotspots.”
The regions where we expect to see home prices continue to sustain growth are the more affordable Midwest, buyers continue to seek markets where prices fit traditional debt-to-income ratios, despite the spike in 30-year fixed mortgage rates, and the Northeast, where limited housing supply is sustaining prices.
Meanwhile, markets with rising inventories, added construction, and slowing job and population growth are still searching for a price bottom. In many of these locations, higher mortgage rates have further discouraged buyers. Overall, the housing market now reflects two distinct realities across the country.
Many of the top 100 metropolitan areas are seeing a clear slowdown in 3-month momentum compared to their annual benchmarks. For example, while San Francisco, CA posted a strong 7.0% year-over-year gain in August 2026, its 3-month momentum turned negative at -2.7%, indicating a sharp late-summer cooldown.
Cotality expects to see home price growth trend negatively as 2026 comes to an end.
Top Takeaways:
- U.S. single-family home prices increased by 1.8% year over year in August 2026 compared with August 2025. On a month-over-month basis, home prices declined by -0.1% from July 2026.
- Cotality’s forecast shows annual U.S. home price gains increasing by 1.6% year-over-year in August 2027.
- Among states, Illinois (6.8%) and Connecticut (6.3%) saw the most annual growth in August. They were followed by Indiana (5.6%), New Jersey (5.6%), and Alaska (5.1%).
- 21 states posted reached new price growth highs in August, while only three saw negative home price growth: Washington (-0.4%), Texas (-0.7%), and Hawaii (-0.8%).
- 31 metros posted negative three-month price momentum in August, up from 19 in July.
- The top markets at risk for price declines in the next 12 months, according to Cotality’s Market Risk Indicators include: Buffalo-Cheektowaga, NY; Cambridge-Newton-Framingham, MA; Providence-Warwick, RI-MA; St. Petersburg-Clearwater-Largo, FL; and Worcester, MA.
The next Cotality Home Price Index will be released on November 3, 2026, featuring data for September 2026. For ongoing housing trends and data, visit the Cotality Insights blog: www.cotality.com/insights.
Methodology
The Cotality HPI™ is built on industry-leading public record, servicing, and securities real-estate databases and incorporates more than 50 years of repeat-sales transactions for analyzing home price trends. Generally released on the first Tuesday of each month with an average five-week lag, the Cotality HPI is designed to provide an early indication of home price trends by market segment and for the Single-Family Combined tier, representing the most comprehensive set of properties, including all sales for single-family attached and single-family detached properties. The indices are fully revised with each release and employ techniques to signal turning points sooner. The Cotality HPI provides measures for multiple market segments, referred to as tiers, based on property type, price, time between sales, loan type (conforming vs. non-conforming) and distressed sales. Broad national coverage is available from the national level down to ZIP Code, including non-disclosure states.
Cotality HPI Forecasts™ are based on a two-stage, error-correction econometric model that combines the equilibrium home price—as a function of real disposable income per capita and housing supply constraints—with short-run fluctuations caused by market momentum, mean-reversion, and exogenous economic shocks like changes in the unemployment rate. With a 30-year forecast horizon, Cotality HPI Forecasts project Cotality HPI levels for two tiers — Single-Family Combined (both attached and detached) and Single-Family Combined Excluding Distressed Sales. As a companion to the Cotality HPI Forecasts, Stress-Testing Scenarios align with Comprehensive Capital Analysis and Review (CCAR) national scenarios to project five years of home prices under baseline, and severely adverse scenarios at state, metropolitan areas and ZIP Code levels.
About Market Risk Indicators
Market Risk Indicators are a subscription-based analytics solution that provide monthly updates on the overall health of housing markets across the country. Cotality data scientists combine world-class analytics with detailed economic and housing data to help determine the likelihood of a housing bubble burst in 400+ major metros and all 50 states. Market Risk Indicators is a multi-phase regression model that provides a probability score (from 1 to 100) on the likelihood of two scenarios per metro: a >10% price reduction and a ≤ 10% price reduction. The higher the score, the higher the risk of a price reduction.
About the Market Condition Indicators
As part of the Cotality HPI and HPI Forecasts offerings, Market Condition Indicators are available at the state, metropolitan area and county levels, identifying individual markets as overvalued, at value or undervalued. These indicators are derived from the long-term fundamental values, which are a function of real disposable income per capita and housing supply constraints. Markets are labeled as overvalued if the current home price indexes exceed their long-term values by greater than 10% and undervalued where the long-term values exceed the index levels by greater than 10%.
Source: Cotality
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About Cotality
Cotality accelerates data, insights, and workflows across the property ecosystem to enable industry professionals to surpass their ambitions and impact society. With billions of real-time data signals across the life cycle of a property, we unearth hidden risks and transformative opportunities for agents, lenders, carriers, and innovators. Get to know us at www.cotality.com.
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