Would-be home buyers wrestling with a decision about whether to take the plunge as interest rates come down will find little to comfort them in a new report from the National Association of Realtors (NAR), which shows that values in 3Q 2025 have risen in 77% of U.S. metro areas. That is 2% more than in the second quarter.
The median price of an existing single-family home rose to $426,800 nationwide, up 1.7% annually. In some regions, however, the increase was much steeper.
In the Northeast, for example, the median rose 6% to $540,100. The Midwest saw a 4.2% increase to $331,100, while the South saw a much more modest 0.5% gain to $372,800.
The West was the exception, bucking the trend with a 0.1% decrease to $633,900.
Robust home construction, which boosted supply, helped lower prices in the Southern states. Still, the price drops should be viewed as temporary because of the region’s faster job growth or as a second-chance opportunity for households previously priced out of the market, NAR said.
Affordability did improve slightly in 23% of markets where home prices slipped. The monthly mortgage payment on a typical existing family home fell 2.8% from the second quarter to $2,187, but the result was mixed because it was a 2.1% increase year-over-year. The average share of income that typical families spent on mortgage payments fell from 25.6% in the second quarter to 24.8% in the third quarter.
First-time homebuyers also confronted a mixed picture. The monthly mortgage payment on a typical starter home valued at $362,800 with a 10% down payment came in at $2,146. That was $61 less than the second quarter but $45 more than the previous year. First-time homebuyers could expect to allocate 37.4% of their monthly income to mortgage payments, less than the 38.6% they would have had to spend in the previous quarter.
Ten large markets where prices increased within a range of 9.9% to 7.7% were Trenton, NJ, Lansing-East Lansing, MI, Nassau and Suffolk Counties, NY, New Haven, CT, New York, Manchester, NH, St. Louis, MO, Bridgeport, CT, Toledo, OH and Cleveland (OH).
The most expensive markets were San Jose ($1.92 million up 8%), Anaheim ($1.4 million up 1%), San Francisco ($1.32 million up 0.8%), Urban Honolulu ($1.12 million down 09%), Salinas ($1.02 million up 6.3%), San Diego ( $1.01 million, up 0.5%), Los Angeles ($954,100, up 0.7%), Oxnard ($935,700, down 1.2%), San Luis Obispo ($931,800, down 1.9%) and Bridgeport ($844,900, up 7.8%).
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