Annual US home price growth slipped below 1% and prices are falling in more than half of major metros.

Those were the two main takeaways from Tuesday’s update on the most widely-cited price gauges.

The data, released on the usual two-month delay, found the Case-Shiller 20-city index posting a mere 0.9% gain for February, the slowest since July of 2023.

The figure above’s a reminder: Home price growth has undershot headline inflation since last summer. February was the ninth month in a row during which real US housing wealth contracted.

This matters. This is the “organic” way homes become more affordable: If price growth’s undershooting headline inflation, it’s likely undershooting wage growth too, which means wage-earners are catching up, however slowly.

The problem, obviously, is that with financing costs well north of 6% and home prices still staggeringly high, this isn’t an especially efficient mechanism. Indeed, as S&P’s head of FICC Nicholas Godec remarked on Tuesday, the reason nominal price growth’s below inflation is because affordability concerns are depressing transaction activity.

A peek below the index level reveals wildly divergent fortunes. In Denver, prices fell nearly 2.5% in February versus the same period last year, while home values in Chicago rose by twice that. “The 7.2ppt spread between Chicago and Denver illustrates how localized the housing story has become,” Godec went on to say.

Overall, the data suggested US housing entered the spring buying season on shaky footing, an assessment supported by a hodgepodge of metrics including, but by no means limited to, a new February record for price cuts and record March deal cancelations.

Summing things up Tuesday, Godec said America’s housing slowdown “has broadened well beyond its Sun Belt origins.”