Why it matters
- U.S. single-family home prices rose 1.8% from a year earlier in August but slipped 0.1% from July, according to Cotality.
- Cotality expects month-over-month price declines through the winter after August's jump in mortgage rates slowed buying.
- Prices are falling in Texas and Washington, and 31 metros showed negative three-month momentum, up from 19 in July.
U.S. single-family home prices rose 1.8% in August from a year earlier, up from a 1.6% gain in July, Cotality said in its Home Price Index released Oct. 6. But prices slipped 0.1% from July, and the company expects month-over-month declines through the winter as higher mortgage rates keep buyers on the sidelines.
For flippers, that means the value a house is worth today may not be the value it sells for after a three- or four-month rehab.
Are home prices going up or down?
Both, depending on where you look. Prices are still higher than a year ago nationally, but momentum has turned. Cotality said 31 metros posted negative three-month price momentum in August, up from 19 in July.
San Francisco is an example. Prices there were up 7.0% from a year earlier in August, but three-month momentum was negative at -2.7%, which Cotality called "a sharp late-summer cooldown."
Cotality expects annual appreciation of 1.3% for 2026 and forecasts a 1.6% annual gain by August 2027.
Where are prices rising and falling?
The Midwest and Northeast are leading. Cotality said 21 states, mostly in those two regions, reached new price growth highs in August.
| State | Annual price change, August 2026 |
|---|---|
| Illinois | +6.8% |
| Connecticut | +6.3% |
| Indiana | +5.6% |
| New Jersey | +5.6% |
| Alaska | +5.1% |
| Washington | -0.4% |
| Texas | -0.7% |
Hawaii also posted a decline, Cotality said. Markets with rising inventory, new construction and slowing job and population growth "are still searching for a price bottom," the company said.
Why are buyers pulling back?
Mortgage rates. Cotality said the market kept slowing after rates jumped in August, with the pullback visible in September's pending home sales. Freddie Mac said the average 30-year fixed rate was 7.28% on Oct. 1, up from 7.03% a week earlier and 6.34% a year earlier.
"Many buyers halt their searches when rates exceed 7%," said Selma Hepp, Cotality's chief economist. She said elevated rates and affordability problems "will favor markets with lower entry prices and strong local job growth over former high-growth pandemic hotspots."
What this means for flippers
Cotality's data lines up with flip returns. Texas, where prices are falling, had four of the five weakest flip margins among large metros in the second quarter, according to ATTOM: San Antonio (-0.3%), Dallas (1.8%), Austin (2.8%) and Houston (3.7%).
But strong margins do not mean no risk. Buffalo, N.Y., had the second-highest typical flip margin among large metros at 76.6%, ATTOM said. Cotality lists Buffalo-Cheektowaga among the top five markets at risk of price declines over the next 12 months, along with Cambridge-Newton-Framingham, Mass.; Providence-Warwick, R.I.-Mass.; St. Petersburg-Clearwater-Largo, Fla.; and Worcester, Mass.
- Price the resale off closed sales. Build after-repair value from recent comps, not last spring's peaks. The ARV from Comps tool helps.
- Know how far the price can fall. The Break-Even Sale Price calculator shows your floor.
- Plan for a slower sale. The Holding Cost Timer shows what each extra month costs.
For the latest flip returns by metro, see Where Flips Still Pay. For the resale side, see Price Cuts Hit 20.8% of Home Listings. Cotality's next index, with September data, is due Nov. 3.
Sources
- Cotality via Business Wire, Cotality: Buyers Continue to Pull Back as Home Prices Increase (Oct. 6, 2026)
- Freddie Mac, Primary Mortgage Market Survey (Oct. 1, 2026)
- ATTOM, Home Flipping Profits Continue Gradual Two-Year Decline (Oct. 1, 2026)