Austin Real Estate in 2025: Navigating a Buyer’s Market Amid a Post-Peak Correction

​The Austin market currently has 17,456 active residential listings, just 85 below the recent high of 17,541 recorded on June 9, 2025. This elevated inventory level signals a shift from the tight supply conditions of 2020–2022, when low inventory fueled intense competition and rapid price escalation. The fact that 53.7% of these listings have experienced a price drop underscores a market where sellers are increasingly compelled to adjust expectations to attract buyers. This high percentage of price reductions, coupled with only 2.3% of listings seeing price increases, suggests a lack of upward price pressure and a market where buyers hold significant negotiating power.

The Activity Index, at 21.3%, reflects subdued market velocity compared to 24.7% in 2024, a 14.0% year-over-year decline. This index, which measures the pace of market activity, indicates that transactions are slowing, likely due to a combination of higher inventory and cautious buyer sentiment. Similarly, the Months of Inventory metric, at 6.19, represents a 21.0% increase from 5.12 in 2024, further confirming a market with ample supply relative to demand. A Months of Inventory figure above 6 typically signals a buyer’s market, as it suggests it would take over six months to sell all current listings at the current sales pace, a stark contrast to the seller’s market conditions of 2021, when inventory was often below 2 months.

New listings and pending sales provide additional insight into market dynamics. Cumulative new listings from January to June 2025 total 24,430, which is 17.9% above the historical average but reflects a 4.2% year-over-year decline from 2024. This suggests that while sellers are still entering the market at a robust pace, the rate of new listings is slightly cooling, possibly due to seller hesitation in a softer market. On the demand side, pending listings for 2025 stand at 4,720, down 2.2% from 4,826 in 2024, and cumulative pending listings from January to June total 20,063, which is 7.9% below average and a significant 17.1% drop from 2024. The gap between new listings and pending sales is notable, with a year-to-date cumulative difference of 6,367, the highest since 2004’s 7,383. This imbalance indicates that new listings are outpacing pending sales, contributing to the high inventory levels and downward pressure on prices.

The Monthly New Listing to Pending Ratio, currently at 0.52, and the year-to-date ratio of 0.66, both fall well below the 25-year average of 0.81. A ratio below 1 means more listings are coming to market than going under contract, reinforcing the buyer-friendly environment. Historically, ratios closer to or above 1, as seen in the seller’s markets of 2013–2021, indicated stronger demand relative to supply.

Sales activity further illustrates the market’s slowdown. The number of sold properties for June 2025 is 2,425, and cumulative sold properties from January to June total 14,512, which is 5.1% above the historical average but down 9.2% from 2024. This year-over-year decline aligns with the broader trend of reduced transaction volume, as buyers appear more selective amid higher inventory and softening prices. When normalized for population, cumulative sold properties per 100,000 residents total 570, which is 22.3% below average and down 11.3% from 2024. Similarly, cumulative sold properties per 1,000 realtors total 781, 26.4% below average and down 5.3% year-over-year. These metrics suggest that the market is less active per capita and per realtor compared to historical norms, reflecting a combination of reduced buyer demand and an oversupply of listings relative to sales professionals’ capacity to close deals.

Price trends are a critical component of this analysis, and the data reveals a market grappling with a correction from its 2022 peak. The average sold price for June 2025 is $613,577, down 10.02% ($68,362) from the May 2022 peak of $681,939. The median sold price is $470,000, a 14.55% ($80,000) drop from the May 2022 peak of $550,000. These declines are significant, as they reflect a broader correction in Austin’s housing market following the frenzied price growth of 2020–2022, when median prices surged 31.5% from 2020 to 2021 alone. Comparing the current median sold price to 36 months prior (June 2022), the market is down 12.15%, further evidence of the ongoing correction. The historical context from 2000 to 2025 shows a 25-year compound appreciation rate of 5.163% for Austin, which is robust but masks recent volatility. Assuming the market has reached the bottom of its correction at a median sold price of $470,000, a projection using the 5.163% annual compound appreciation rate estimates it would take 40 months (until September 2028) to return to a peak value of $549,795. This projection assumes steady appreciation without external shocks, which is optimistic given current economic uncertainties, including interest rate fluctuations and potential shifts in buyer sentiment.

City-specific price trends highlight varied performance across the Austin metro area. Of the 30 cities tracked, 11 saw year-over-year increases in median sold prices from 2024 to 2025, 18 experienced declines, and one (Jarrell) remained unchanged. Cities with gains include Austin (up 1.1% to $579,000), Driftwood (up 22.4% to $1,162,500), and San Marcos (up 5.2% to $357,757), suggesting pockets of resilience, particularly in high-demand or premium markets. Conversely, significant declines occurred in Burnet (down 19.4% to $333,355), Spicewood (down 15.7% to $630,000), and Dale (down 13.7% to $319,251), indicating softer demand in more rural or less central areas. The high vs. low home price trends provide further granularity: the bottom 25th percentile of homes saw a 3.3% price decline and a 3.9% drop in price per square foot, while the top 25th percentile experienced a 2.3% price decline and a 3.4% drop in price per square foot. This suggests that lower-end homes are facing slightly more downward pressure, possibly due to affordability constraints for first-time buyers, while high-end homes are holding value marginally better, though still declining.

The Market Health Index (MHI) and Inventory Stress Index (ISI) offer composite views of market conditions. The MHI, which combines velocity, absorption, and inventory metrics, stood at 19.9% in May 2025, well below the 30% threshold for a balanced market and indicative of a strong buyer’s market. This is a sharp decline from the seller’s market peaks of 2021, when MHI reached 128.6% in March, reflecting the frenzy of that period. The ISI, at 6.9% in May 2025, is also low, signaling minimal stress on inventory and a market where supply significantly outpaces demand. A high ISI (>50%) would indicate a seller’s market, as seen in 2020–2021, but the current low value suggests buyers face little competition, creating opportunities for negotiation and potentially better deals.

From a historical perspective, Austin’s market has experienced cycles of boom and correction. The 2000–2007 period saw steady growth, with median sold prices rising from $143,266 to $183,445. The 2008–2011 downturn brought declines, with total sales dropping to 19,734 in 2010, a 4.0% year-over-year decrease. The recovery from 2012 to 2019 was robust, with sales peaking at 37,486 in 2019 and median prices climbing to $312,853. The pandemic-era boom of 2020–2021 was unprecedented, with sales reaching 41,552 in 2021 and median prices soaring to $449,092, a 31.5% year-over-year increase. The current correction, with 2025 projected sales at 28,894 (down 7.8% from 2024) and a median price of $439,076 (down 0.4%), mirrors post-2008 dynamics but is less severe, supported by Austin’s strong economic fundamentals, including tech industry growth and population inflows.

For stakeholders, the implications are clear. Buyers benefit from high inventory, low competition, and declining prices, making 2025 an opportune time to purchase, particularly for those with long-term horizons who can weather short-term fluctuations. Sellers face challenges, as the high percentage of price drops and slow absorption rates necessitate competitive pricing and flexibility. Investors should focus on markets with low ISI, such as Austin proper or Driftwood, where appreciation potential remains strong despite current softness. The projection of a 40-month recovery to peak prices suggests patience is required, but Austin’s historical 5.163% compound appreciation rate underscores its long-term resilience.

In conclusion, the Austin real estate market in June 2025 is heading to a buyer’s market characterized by high inventory, declining prices, and subdued demand. The data from Team Price Real Estate highlights a correction from the 2022 peak, with significant declines in average and median sold prices, a surplus of listings, and low market health and inventory stress indices. While certain cities show resilience, the overall trend favors buyers, who can leverage ample supply and negotiating power. Sellers and investors must navigate a challenging landscape, but Austin’s long-term growth trajectory remains intact, supported by its economic vibrancy and historical appreciation trends. The projected recovery by September 2028 (if today is the "bottom" of the market) offers a roadmap for strategic decision-making, positioning Austin as a market with both immediate opportunities and enduring potential.

Scroll down to view the full Austin Daily Real Estate Briefing PDF for June 10, 2025, with today's data.