December 2025 Housing Market Report: Where Home Prices Fell, Where Sellers Cut, and Who Could Afford to Buy
In December 2025 the typical U.S. home was worth $366,588, up 0.1% in a year. Values fell in 15 states, Indiana had the most price cuts, and the median household could afford the typical home in 3 states. Zillow Research data, all 50 states.
The national picture for December 2025
The typical U.S. home rose 0.1% over the year to $366,588 in December, according to the Zillow Home Value Index, and is up 34.3% over five years. A 20%-down mortgage on that home cost $1,794 a month in principal and interest and took about $95,781 of household income. Typical rent was $1,892, up 2.0% in a year. 21.7% of listings cut their price during the month, homes went pending in 65 days, and 1.24M homes were for sale, up 11.3% from a year earlier.
Underneath that average, the 50 states moved in different directions. Values were falling in 15 states and rising in 34; 26 states were at an all-time high while Arizona sat 8.8% below its July 2022 peak of $462,506. This report reads the state-level Zillow files for December 2025 as published, with no modeling and no forecasts.
Where home prices were falling: 15 states
The steepest year-over-year declines were in Florida (-5.1%), Arizona (-2.9%), Texas (-2.4%), Colorado (-2.4%), and Hawaii (-2.2%). Florida's typical home stood at $377,012, 6.8% below its May 2024 peak of $404,529. At the other end, North Dakota (+4.8%), Wisconsin (+4.7%), and Illinois (+4.3%) posted the fastest gains.
By region, the West carried the highest median state value at $476K and the Midwest the lowest at $269K. The West was down 0.5% on the median state, with values falling in 7 of its 13 states, the Northeast was up 2.7% on the median state, with values falling in 1 of its 11 states, the South was flat on the median state, with values falling in 7 of its 14 states, and the Midwest was up 3.4% on the median state, with values falling in 0 of its 12 states.
| State | Typical home | 1 yr | 5 yr | vs. peak |
|---|---|---|---|---|
| Florida | $377,012 | -5.1% | +38.4% | -6.8% |
| Arizona | $421,917 | -2.9% | +32.3% | -8.8% |
| Texas | $303,097 | -2.4% | +26.9% | -4.9% |
| Colorado | $541,987 | -2.4% | +23.7% | -5.5% |
| Hawaii | $829,612 | -2.2% | +27.8% | -2.8% |
| California | $765,322 | -2.1% | +28.0% | -2.1% |
| Georgia | $332,288 | -2.0% | +40.6% | -2.4% |
| Nevada | $447,890 | -1.5% | +35.7% | -3.0% |
| Vermont | $395,647 | -1.0% | +33.0% | -2.2% |
| Oregon | $499,066 | -0.8% | +23.4% | -3.0% |
Where sellers were cutting prices: Indiana led at 26.7%
Price cuts are the earliest sign that a market is turning. Indiana (26.7%), Arizona (26.5%), Ohio (25.9%), Utah (25.6%), and Tennessee (25.5%) had the largest share of listings with a reduced price, all above the national 21.7%. The fewest cuts were in New York (13.6%), Wyoming (14.7%), and Montana (15.5%).
Combining price cuts with days to pending and the change in homes for sale, 9 states were cold, buyer's markets (Colorado, Utah, Nevada, Arizona, North Carolina, Tennessee, Georgia, South Carolina, and Texas) and 0 were hot, seller's markets. Florida had the slowest sales at 97 days to pending; Connecticut the fastest at 34.
| State | Price cuts | vs. year ago | Days to pending | Homes for sale | Market |
|---|---|---|---|---|---|
| Indiana | 26.7% | +0.1 pts | 48 | +13.7% | Cool |
| Arizona | 26.5% | -0.3 pts | 68 | +13.9% | Cold |
| Ohio | 25.9% | +0.6 pts | 38 | +11.8% | Cool |
| Utah | 25.6% | +0.7 pts | 71 | +16.8% | Cold |
| Tennessee | 25.5% | +0.9 pts | 73 | +18.4% | Cold |
| Maryland | 24.6% | +1.9 pts | 46 | +26.3% | Cool |
| Nevada | 24.0% | +1.5 pts | 72 | +15.5% | Cold |
| Colorado | 23.4% | -0.5 pts | 80 | +14.3% | Cold |
| Nebraska | 23.4% | -0.2 pts | 51 | +18.2% | Cool |
| North Carolina | 23.2% | +1.9 pts | 67 | +20.3% | Cold |
Who could still afford to buy: the median household cleared the bar in 3 states
Zillow's income-needed figure assumes 20% down at that month's rates and a payment of no more than 30% of income. Set against each state's median household income from the Census Bureau, the typical household could afford the typical home in 3 of 50 states: West Virginia, Iowa, and Mississippi. The widest gaps were in California (needed $190K, median earns $92K), Hawaii (needed $193K, median earns $95K), and Washington (needed $152K, median earns $90K).
Renting was cheaper than a mortgage payment in 35 of the 50 largest metros, one per state. The widest gap in favor of renting was Los Angeles (California) at $1,777 a month; buying won most clearly in Charleston (West Virginia), where the payment was $473 below rent. Both comparisons leave out property tax, insurance and maintenance.
| State | Typical home | Payment | Income needed | Median income | Gap |
|---|---|---|---|---|---|
| West Virginia | $175,000 | $857 | $44,237 | $54,515 | -19% |
| Iowa | $234,905 | $1,150 | $66,831 | $72,429 | -8% |
| Mississippi | $193,383 | $947 | $52,605 | $52,985 | -1% |
| Kentucky | $232,145 | $1,136 | $60,606 | $60,407 | +0% |
| Kansas | $245,206 | $1,200 | $70,798 | $69,747 | +2% |
| California | $765,322 | $3,746 | $189,859 | $91,905 | +107% |
| Hawaii | $829,612 | $4,061 | $193,197 | $94,814 | +104% |
| Washington | $600,041 | $2,937 | $151,568 | $90,325 | +68% |
| Massachusetts | $655,930 | $3,210 | $169,068 | $101,370 | +67% |
| Idaho | $476,313 | $2,331 | $112,713 | $68,930 | +64% |
How to read this report
Every housing figure is Zillow Research's published number for December 2025: the Zillow Home Value Index (typical value of homes in the middle third of a market, not a median sale price), the Zillow Observed Rent Index for each state's largest metro, Zillow's mortgage payment and income-needed series, and its inventory, price-cut and days-to-pending metrics. Sale and list prices are the latest available at the time, which can lag a month. Median household income is from the Census Bureau's American Community Survey and does not change month to month. The current 50-state table, map and a page for every state are on the housing hub.
December 2025 Housing Market FAQ
What is the median home price in the United States?
$358,867 was the U.S. median sale price and $396,283 the median list price in the latest Zillow Research release. The typical U.S. home value, the Zillow Home Value Index this page ranks states by, is $366,588, up 0.1% over the past year and up 34.3% over five years. A 20%-down mortgage on the typical home runs $1,794 a month in principal and interest, which takes about $95,781 of household income.
What is the cheapest state to buy a house?
West Virginia is the cheapest state to buy a house, with a typical home value of $175,000 in the latest Zillow Research release, followed by Mississippi ($193,383), Louisiana ($213,454), Oklahoma ($219,754), and Arkansas ($222,323). A 20%-down mortgage on the typical West Virginia home is $857 a month, and buying it takes about $44,237 of income against a median household income of $54,515.
Which state has the most expensive homes?
Hawaii has the most expensive typical home at $829,612, then California ($765,322), Massachusetts ($655,930), Washington ($600,041), and New Jersey ($566,109). Buying the typical Hawaii home takes about $193,197 of household income; the state's median household earns $94,814.
Which states are most affordable relative to income?
West Virginia is the most affordable state relative to what households actually earn: buying the typical home takes $44,237 of income and the median household earns $54,515. The next most affordable are Iowa, Mississippi, Kentucky, and Kansas. The least affordable is California, where the income needed ($189,859) is 106.6% above the median household income.
How much income do you need to buy a house in each state?
It ranges from $44,237 in West Virginia to $193,197 in Hawaii, using Zillow's assumptions of 20% down at current mortgage rates and a payment of no more than 30% of income. Nationally the figure is $95,781. The median household earns enough to clear that bar in 3 states and falls short in 47. The full figure for every state is in the table above.
What is the average mortgage payment by state?
The monthly principal-and-interest payment on the typical home with 20% down ranges from $857 in West Virginia to $4,061 in Hawaii; the national figure is $1,794. The cheapest payments are in West Virginia ($857), Mississippi ($947), Louisiana ($1,045), and Oklahoma ($1,076). These exclude property tax, insurance and HOA dues, which vary widely by state.
Figures are Zillow Research's published state and metro data for December 2025, shown as released with attribution; median household income is from the Census Bureau's American Community Survey. All monthly reports →