The latest US House Price Index (HPI), published on November 25, 2025, by the Sigmanomics database, recorded a value of 435.40. This figure is marginally above October’s 435.30 but below the market estimate of 436.60, signaling a plateau in house price growth after a volatile year. The index remains elevated compared to the 12-month average of approximately 435.10, reflecting persistent but slowing price pressures.

Geographic & Temporal Scope

The HPI covers all 50 states, with notable regional divergence. The Sun Belt states, including Texas and Florida, continue to see above-average price gains, driven by migration and job growth. Conversely, the Northeast and parts of the Midwest show stagnation or mild declines, reflecting tighter credit and affordability constraints. Over the past 11 months, the index has fluctuated between a low of 433.40 (January and September) and a high of 437.30 (April), illustrating a cooling trend since spring 2025.

Core Macroeconomic Indicators

House prices remain sensitive to broader economic conditions. US GDP growth slowed to an annualized 1.80% in Q3 2025, while unemployment held steady at 3.70%. Inflation remains above the Federal Reserve’s 2% target, with the Consumer Price Index (CPI) at 3.10% year-over-year. These factors contribute to cautious consumer sentiment and restrained housing demand.

Monetary policy and financial conditions have been pivotal in shaping housing market dynamics this year.

Monetary Policy & Financial Conditions

The Federal Reserve has maintained a restrictive stance, holding the federal funds rate at 5.25% to combat inflation. Mortgage rates remain elevated, with the 30-year fixed rate averaging 6.80%, up from 5.50% a year ago. This has dampened refinancing activity and cooled buyer enthusiasm. Credit availability tightened modestly, with banks increasing lending standards amid economic uncertainty.

Fiscal Policy & Government Budget

Federal fiscal policy has been neutral to mildly supportive. The government’s budget deficit narrowed to 3.20% of GDP in FY2025, limiting large-scale housing stimulus. However, targeted programs for affordable housing and first-time buyers continue, providing localized support. State-level incentives in growth regions have helped sustain demand.

External Shocks & Geopolitical Risks

Geopolitical tensions, including trade disputes and energy market volatility, have introduced risk premiums into financial markets. These external shocks contribute to cautious investment in real estate, especially in commercial and speculative segments. Supply chain disruptions persist, affecting construction costs and timelines.

Drivers this month

• Mortgage rates (6.80%) restraining buyer affordability
• Sun Belt migration supporting demand (0.40% MoM in key states)
• Supply constraints easing slightly, moderating price spikes
• Stagnant wage growth limiting purchasing power

Policy pulse

The HPI remains below the peak levels seen in early 2025, consistent with the Federal Reserve’s tightening cycle aimed at cooling inflation. The index’s plateau aligns with the Fed’s inflation target zone, suggesting some success in moderating housing cost pressures without triggering a sharp downturn.

Market lens

Immediate reaction: The US dollar index (DXY) strengthened 0.15% post-release, reflecting cautious optimism. Treasury yields on 2-year notes rose 5 basis points, signaling continued expectations of restrictive monetary policy. The S&P 500 (SPX) dipped 0.30%, weighed by concerns over slower consumer spending in housing-related sectors.