National home prices slipped 0.1% from June to July while notching 2.3% annualized growth amid a broader cool down in price growth, according to House Price Index (HPI) data released Tuesday by the Federal Housing Finance Agency (FHFA).

The latest HPI update shows home prices rose year over year across all nine U.S. census divisions in July, with the most dramatic increased observed in the Middle Atlantic division, which includes New York, New Jersey and Pennsylvania. However, home prices fell 1.2% in the Middle Atlantic division on a monthly basis.

The Pacific division, which includes Washington, Oregon and California, recorded the slowest rate of annual home price growth at 0.2%, followed by the South Atlantic division at 0.8%, which includes Florida, Georgia, South Carolina, North Carolina, Virginia, West Virginia, Maryland, Delaware and Washington, D.C.

From July 2023 to July 2024, the FHFA’s HPI rose 4.8%, more than double this year’s pace of 2.3%. The latest HPI data affirm the slowdown in home price appreciation projected for 2025 as rising inventory and lagging demand distort market conditions in some parts of the country.

In June alone, 26.6% of for-sale listings cut their prices, the highest level for June since 2018, according to Zillow data. Cooling home price gains and sluggish sales were a defining feature of the summer housing market, helping for-sale inventory pile up.

A recent Redfin report concluded that 33 of the 50 most populous U.S. metros were buyer’s markets in August, though sellers still control the market in the Middle Atlantic region, where home price growth has shown more resilience.

The Redfin report stated the number of active homebuyers in August (1.44 million) fell to its lowest level since 2013, excluding a period at the onset of the pandemic. As affordability constraints continue to hold back purchases, home price softening will likely continue until demand stabilizes.