Home prices are plummeting everywhere but the US. Blame America's favorite mortgage.

• US home prices fell year-over-year for the first time since 2012 in February.
• But compared to the rest of the world, US homebuyers haven't gotten much of a discount at all.

Home prices are falling in the United States, but compared to the rest of the world, US buyers are barely getting a break at all.

In February, US home prices declined year-over-year for the first time since 2012, according to a National Association of Realtors report. The median existing home price fell to $363,000 in February, a 0.2% decline from a year prior.

But compared to homebuyers across the globe, Americans have much less reason to celebrate.

That's according to a March OECD report, which measured how much housing prices in 11 countries have fallen since their most recent peaks — rather than on a year-over-year basis like the NAR data.

In the US, home prices fell 0.9% between the market's peak in June 2022 and December. Every one of the other 10 countries' housing markets, however, each of which was measured between December and February, reported a larger fall in home prices from their respective peaks — which came between November of 2021 and August of 2022.

Per the report, Sweden and New Zealand housing prices both fell roughly 14% from their peaks, while Germany, South Korea, Canada, and Australia saw declines between 5 and 10%. Only the United Kingdom, Denmark, the Netherlands, and Norway saw declines within a few percentage points of the US, ranging between 2.1% and 3.7%.

Countless supply and demand factors have influenced global home prices. And in the US, a lack of housing supply is arguably the biggest factor holding back housing affordability. But when it comes to the question of why housing prices haven't fallen as much in the US as the rest of the world over the past year, there's arguably one key culprit for prospective US homebuyers to blame.

Blame the most popular mortgage in the US: The 30-year, fixed-rate mortgage

The US's predominant home loan structure — which up to 90% of US borrowers opt for — maintains the same monthly mortgage payment over the course of the 30-year loan period, regardless of whether interest rates rise or fall.

Across the globe, central banks have raised interest rates in an effort to quell inflation. Experts have pointed to housing as one of the industries most likely to be impacted by rising rates, given they make homebuying more expensive.

But rising mortgage rates don't impact every country's housing market the same way. It comes down to the different ways countries structure their home loans.

The US, for instance, is the only country in which the 30-year-fixed mortgage is the dominant mortgage product, though many borrowers in countries like Denmark, Germany, the Netherlands, the United Kingdom, and Canada have fixed-rate mortgages for at least part of their loan payment periods. Some borrowers only have fixed rates for the first few years or have fixed rates that are "re-fixed" every few years, leaving them still exposed to rising rates.

For fixed-rate borrowers, many of whom locked in their mortgages when interest rates were low, rising interest rates have no impact on their monthly mortgage payments. Rising rates would, however, impact the cost of their next mortgage payment if they sold their current place and bought a new one.

Faced with this scenario, many homeowners across the globe who might otherwise have moved are choosing to stay right where they are — unless they get a tremendous offer. The lack of sellers has meant more competitive housing markets, which has helped prop up prices in the US and other countries with a lot of fixed-rate mortgages.

"The supply is not enough," Nadia Evangelou, the NAR's director of real estate research, told Insider in February. "There are not enough homes that can make prices drop — even though there's less demand."

But it's a different story in countries like Sweden and New Zealand, where a majority of borrowers either have floating rate mortgages — meaning their monthly payments go up when interest rates rise — or have fixed rates that reset every few years.

While many homeowners in these countries may not be eager to sell, some of them may have no choice as rising payments put increasing pressure on their finances.

After seeing home prices plunging around her, 28-year-old Madeleine Eiswohld sold her Sweden apartment last week for 4% less than she bought it for two years earlier, she told The New York Times.

And for the floating rate borrowers who do want to sell their homes, they won't have to worry about losing out on their existing mortgage rate when they do so.

These factors have contributed to more selling — and home prices falling more than in countries like the US.

Big picture, one can make arguments for and against fixed-rate mortgages. And if plummeting housing prices are a signal a country's economy is on the brink, then perhaps it isn't such great news for aspiring homebuyers after all.

But in the 2023 economy, the US's reliance on fixed-rate mortgages is helping to keep home prices elevated — which is generally good news for homeowners and bad news for families looking to buy their first home.

It's among the reasons some US borrowers are bucking convention and seeking out floating — or adjustable-rate mortgages. These borrowers are betting that interest rates will fall in the future and save them thousands of dollars.