Annual home price gains were below 1% for the fifth consecutive month in December, according to newly released data from title insurance giant First American Financial Corp.

In fact, more markets tracked by First American registered price declines last month than price gains. National home prices barely budged over the course of 2025, the company says, which allowed income growth to outpace price gains in recent months, boosting affordability.

“From a national house price perspective, it’s almost like 2025 didn’t happen — prices finished the year nearly unchanged,” said Mark Fleming, chief economist at First American, in commentary accompanying Tuesday’s release of its Home Price Index (HPI) report for December.

Affordability gains driven by income growth relative to cooling home price appreciation was a consistent feature of the housing market in the second half of 2025.

A report released in mid-December by the Mortgage Bankers Association showed that monthly payment amounts on new purchase mortgage applications declined for the sixth consecutive month in November, down nearly $100 from a year earlier.

Home prices slipped 0.2% over the month while rising just 0.5% over the year in December, according to First American’s latest data. Price gains were concentrated in Midwest and Northeast markets where supply remains tight, the company said.

Fleming noted that the 0.5% annual appreciation in December was the slowest pace since 2012.

“Across the top 30 markets we track, prices are flat or declining in 20 markets, and among the 10 markets still posting year-over-year gains, eight are in the Northeast or Midwest,” said Fleming. “Where inventory has grown, particularly in several pandemic-era boom towns like Austin, Texas, and Phoenix, prices are adjusting lower as the market normalizes.”

Core-based statistical areas (CBSAs) tracked by First American that observed the largest annual increases in the HPI in December were Warren, Mich., which rose 4.2%, followed by New York, Cambridge, Mass., St. Louis and Baltimore, which posted price gains of 2.8%, 2.5%, 2.3% and 2.3%, respectively.

CBSAs that observed the largest annual declines were Oakland, Calif., where home prices dropped 6%, followed by Denver, Miami, Austin and Riverside, Calif., which slipped by respective marks of 4%, 3.9%, 3.7% and 3.4%.

“As we close out the year, the market’s fault line is inventory,” said Fleming.