Home prices in the United States edged down slightly in April, marking the first monthly decline since September 2022, according to new data from real estate firm Redfin (NASDAQ:RDFN). Seasonally adjusted prices fell by 0.1%, a modest shift but a notable one after a long stretch of monthly gains.

On an annual basis, home prices were still up by 4.1%, though that represents a slowdown compared to the 4.9% year-over-year increase seen in March. It also marks the slowest pace of annual growth since July 2023.

These figures come from the Redfin Home Price Index (RHPI), which analyzes changes in home values using a repeat-sales method. This approach tracks how the price of the same property evolves over time, allowing for more accurate assessments of price trends in the single-family housing market.

The April dip is just the third month-over-month decline recorded by the RHPI, with the last two occurring in late summer 2022 amid a flurry of Federal Reserve rate hikes. While the decline was only 0.05% – rounded to 0.1% – it highlights growing signs of cooling in the housing market. It’s also worth noting that RHPI data is subject to future revisions.

Redfin’s Senior Economist, Sheharyar Bokhari, pointed to two main reasons behind the stagnation in prices. First, economic uncertainty – including fears of a potential recession and concerns over U.S. trade policies – is making buyers more cautious. This hesitation is reflected in a 3.5% drop in pending home sales for the month. Second, housing inventory is climbing, reaching a five-year high. With more homes sitting unsold, sellers are increasingly offering concessions to attract buyers.

Despite the slight easing in prices, housing affordability remains a serious hurdle. Elevated mortgage rates, coupled with still-high home prices, are pushing many buyers to the limits of their financial capacity.

Looking at regional trends, home prices declined in half of the 50 largest U.S. metropolitan areas in April. Charlotte, North Carolina, and Virginia Beach, Virginia, led the downturn with 1% drops, followed by Miami with a 0.7% decline. Meanwhile, some markets still saw robust gains – Nassau County, New York posted the biggest increase at 1.8%, trailed by Warren, Michigan (1.3%) and New York City (1.2%).