Home Prices Rose 1.9% Over the Past Year but Still Trailed Inflation, Case-Shiller Report Shows

Home values are inching up in most places, but more slowly than everyday prices. That matters for buyers, sellers and anyone counting on home equity to carry part of their long-term plans.

Two closely watched reports on home prices came out on Tuesday, September 29, and they told a similar story: prices are still rising, but only a little, and not as fast as the cost of living. The S&P Cotality Case-Shiller National Home Price Index rose 1.9% in the 12 months through July, up from a 1.6% gain in June. A separate index from the Federal Housing Finance Agency, the government agency that oversees mortgage giants Fannie Mae and Freddie Mac, showed home prices up 2.6% from July 2025 to July 2026.

How these indexes work

The Case-Shiller indexes track the sale prices of the same homes over time. That repeat-sales method is what makes them so widely watched. If a city happens to sell a lot of large luxury homes one month, a simple average of sale prices would jump even if no individual home gained value. By comparing each house to its own earlier sale, Case-Shiller shows genuine price changes rather than shifts in what kinds of homes are changing hands.

The FHFA index uses a similar approach but focuses on homes with mortgages backed by Fannie Mae or Freddie Mac, which skews it toward conventional, mid-priced properties. That is one reason the two indexes rarely match exactly, even when they point in the same direction.

What the reports found

For July, the national Case-Shiller index was up 1.9% from a year earlier. The 20-City Composite rose 2.5%, compared with 2.2% in June, and the 10-City Composite rose 3.4%, compared with 3.0% in June. The fact that the big-city composites grew faster than the national index suggests that some major metros are still seeing solid demand even as smaller markets cool.

Local results varied widely. Chicago led the country with prices up 6.9% from a year earlier, followed by New York at 5.8% and Cleveland at 4.2%. At the other end, prices fell the most in Seattle, down 1.6%, Las Vegas, down 1.3%, and Denver, down 1.1%.

The FHFA report showed a similar regional split. Over the past 12 months, the Middle Atlantic region had the biggest gain at 6.3%, while the Mountain region had the smallest at 0.6%. Put together, the data paint a picture of a market that is no longer moving as one. The Northeast and Midwest are holding up, while parts of the West that saw huge run-ups in earlier years are giving some of those gains back.

Rising, but losing ground to inflation

Here is the catch. Inflation, the general rise in prices over time, has been running faster than home price growth. According to S&P Dow Jones Indices, July marked the 14th month in a row that home prices fell in real terms, meaning after adjusting for inflation.

Put simply, a home may be worth a bit more in dollars than it was a year ago, but those dollars buy less than they used to. If your home’s value rose 2% while groceries, utilities and services rose faster, your house actually lost purchasing power. That distinction rarely shows up in headlines, but it matters a great deal if you are relying on home equity as a store of wealth.

What this means if you’re hoping to buy

Slower price growth can give buyers a little more breathing room, especially in cities where prices are falling outright. Sellers in those markets may be more open to negotiating on price or covering some closing costs.

But the price tag is only part of the story. The monthly cost of owning a home also depends heavily on mortgage rates, property taxes and insurance. A modest dip in price can be wiped out by a higher interest rate or a jump in insurance premiums. It helps to compare homes by their full estimated monthly payment rather than by sticker price alone.

What this means if you own a home

Your home equity is the part of your home’s value you own outright after subtracting what you still owe on your mortgage. It may still be growing slowly, but it may not be keeping up with inflation. That is a useful reminder not to count on home value alone for long-term goals like retirement or a child’s education.

A home is a place to live first and an investment second. It is illiquid, expensive to sell and comes with ongoing costs for maintenance, taxes and insurance. Building savings in retirement and investment accounts alongside your equity gives you more flexibility and less dependence on what the local housing market happens to be doing when you need the money.

What this means if you’re planning to sell

Local conditions matter enormously. A seller in Chicago and a seller in Seattle are in very different markets right now, and national averages won’t tell either of them much about their own home. Recent sales of similar homes nearby, often called comparables, are usually the best guide to a realistic asking price. An experienced local agent can pull those for you, and pricing correctly from the start tends to beat chasing the market down with price cuts later.

What this means if you rent

Home price trends can feed into rents over time, though the connection is loose and varies by city. A practical habit is to track your housing costs as a share of your income. If rent starts creeping above the level you’re comfortable with, you’ll see it early and can adjust your budget, negotiate at renewal or plan a move on your own timeline.

The bottom line

For most families, housing is the single biggest line in the budget. The latest reports show a market growing slowly, unevenly and below the rate of inflation. Knowing what you spend on housing each month, and what you could afford if your circumstances change, will help you make calmer decisions no matter which way the next report goes.