Cotality, established in property information, analytics, and data‑enabled solutions, recently released its Home Price Index (HPI) with February 2026 data. Year-over-year home price growth slowed to 0.5 percent in February as the U.S. housing market continues to rebalance.
"The recent surge in rates has reduced demand in the housing market, shifting expectations for a broader recovery this year,” Cotality Chief Economist Selma Hepp said in the HPI.
The current market is divided, both nationally and within specific regions.
The Midwest and Northeast, led by states like New Jersey (+5.93 percent) and Illinois (+4.83 percent), are showing stability, supported by relative affordability and employment in higher wage sectors, including biotech and medical research in Massachusetts and Pennsylvania, financial services and fintech in New York and New Jersey, and green infrastructure in other coastal states.
In the Midwest, home price stability is supported by a resurgence of manufacturing as companies mitigate tariffs, CHIPS Act investments in states like Ohio and Michigan, and renewable energy growth in states like Iowa and Kansas. These states are also attracting businesses that are leaving the higher-cost coastal metros.
Meanwhile, slowing price growth continues in Washington, D.C. (-3.01 percent), Florida (-2.30 percent), and Montana (-1.52 percent), the three locations with the largest negative year-over-year changes.
“These diverse trends indicate an ongoing process of price discovery—one where sales and comparisons remain limited and underscore a market that is rebalancing locally rather than correcting nationally,” Hepp said. “Although the steady decrease in mortgage rates prior to the spring homebuying season raised hopes for a rebound in home prices and sales in 2026, the recent surge in rates has reduced demand in the housing market, shifting expectations for a broader recovery this year.”
Top takeaways from the HPI were:
- U.S. single-family home prices increased by 0. percent year over year in February 2026 compared with February 2025. On a month-over-month basis, home prices fell 0.16 percent from January 2026.
- Cotality’s forecast shows annual U.S. home price gains increasing to 4.7 percent year over year in February 2027.
- Newark, N.J. posted the highest year-over-year home price increase of the country's 100 largest metro areas in February, at 6.7 percent. Rochester, N.Y., saw the next-highest gain at 6.3 percent.
- Among states, New Jersey ranked first for annual appreciation in February (up by 5.93 percent), followed by North Dakota (up by 4.92 percent) and Illinois (up by 4.83 percent). 13 states, including the District of Columbia, recorded year-over-year home price losses.
The top markets at risk for price declines in the next 12 months, according to Cotality’s Market Risk Indicators remained in Florida for the second month: Cape Coral–Fort Myers, Deltona-Daytona Beach-Ormond Beach, Lakeland–Winter Haven, Palm Bay–Melbourne–Titusville, and West Palm Beach–Boca Raton–Delray Beach.
According to Cotality’s Market Condition Indicators, 70 of the largest 100 metros are currently overvalued, meaning their current home price indexes exceed their long-term values by greater than 10 percent.
The next Cotality Home Price Index will be released on May 5 featuring data for March.