US Home Prices Increase 5.9% Year-Over-Year in October

On Tuesday, Redfin reported that according to its latest data, US home prices grew 0.5% month-over-month in October on a seasonally adjusted basis, matching September’s increase. Year-over-year, home prices rose 5.9%, the lowest annual increase since December 2023.

This is according to the Redfin Home Price Index (RHPI), which uses the repeat-sales pricing method to calculate seasonally adjusted changes in prices of single-family homes. The RHPI measures sale prices of homes that sold during a given period, and how those prices have changed since the last time those same homes sold.

Home prices maintained steady growth over the past year, with month-over-month gains ranging between 0.2% and 0.7% each month since November 2023—including seven months where growth was between 0.4% and 0.6%. That’s consistent with the pace of growth between 2015–20. The pandemic buying spree saw home prices spike up to nearly 2% month-over-month in June 2021, before falling all the way to -0.1% growth in August 2022.

Redfin notes that elevated mortgage rates have kept a lot of buyers on the sidelines this year, essentially putting a cap on how much prices could rise. But there is still a shortage of homes on the market, which means there is enough competition to keep prices ticking steadily higher.

Commenting on the report, Redfin Senior Economist Sheharyar Bokhari said:

“Many people—especially first-time buyers—were waiting until after the election to make a decision about buying a home. Now the election is over, we have started to see signs that homebuyer demand is coming back. That could lead to increased competition in coming months, possibly pushing prices higher unless we see a major spike in the number of homes being listed.”