The Austin housing market continues to balance on a knife’s edge, with supply building faster than demand and prices holding well below their peak, creating both challenges and opportunities depending on your position in the market.

Scroll down to view the full Austin Daily Real Estate Briefing PDF for September 11, 2025.​

Austin’s active residential listings closed today at 16,954, a 16.2 percent increase from the 14,586 homes on the market one year ago. While inventory has pulled back slightly from its summer high of 18,146 in late June, more than half of these listings—58.2 percent—have already recorded at least one price drop. This signals sellers are still adjusting expectations in a market where buyers have regained significant leverage. From a long-term perspective, Austin’s housing supply remains far above historical norms, reflecting a market correction that has stretched into its third year.

Pending listings tell a different story. At 4,029 today, contracts are running 1.5 percent lower than September 2024 and 8.6 percent below the year-to-date totals of last year. This sluggish absorption has weighed on the Activity Index, which measures the share of homes under contract relative to overall inventory. The index sits at 19.2 percent compared to 21.9 percent a year ago, marking a 12.3 percent year-over-year decline. That drop underscores the reality: demand has not kept pace with the supply surge. For context, the resale Activity Index is just 16.2 percent, while new construction holds a stronger 26.9 percent, showing buyers are still gravitating toward builder incentives and turnkey opportunities.

Another telling metric is the New Listing-to-Pending ratio, which shows how many new listings are hitting the market compared to contracts being signed. The monthly ratio is currently at 0.55, meaning for every home going under contract, almost two new ones are being listed. Year-to-date, the ratio sits at 0.70, compared to a 25-year average of 0.82. This gap highlights the imbalance: Austin continues to outpace demand with fresh supply, which creates pressure on prices and extends marketing times.

The Months of Inventory figure reinforces this shift. Austin stands at six months of inventory, up from 5.19 months a year ago, representing a 15.7 percent increase. At six months, the market sits in neutral territory, leaning toward a buyer’s market when compared with historical averages. Certain submarkets, such as Cedar Park, Georgetown, and Liberty Hill, are showing sharper increases in supply, while a few areas like Buda and Wimberley have managed to tighten slightly. Overall, though, the regional trend is clear: homes are taking longer to sell, and buyers have more leverage in negotiations.

Closed sales reflect this cooling demand. In September, 2,280 homes sold across the Austin-area MLS, bringing year-to-date sales to 22,816. That is down 4.6 percent from last year, but still 5.2 percent above the long-term average. When normalized for population growth, however, the market looks weaker. Sales per 100,000 residents are down 6.8 percent year-over-year and sit 22.4 percent below historical norms. For agents, this means more competition for fewer buyers, and for sellers, it reinforces the need to price sharply and present homes well.

Prices remain below their 2022 peak. The average sold price in September came in at $555,077, down 18.6 percent from the May 2022 high of $681,939. The median price is $424,000, representing a 22.9 percent decline from the May 2022 peak of $550,000. This equates to a loss of roughly $126,000 in median value since the peak. On a three-year comparison, today’s median is almost 10 percent below where prices stood 36 months ago, confirming the persistence of the correction. Yet, the long-run compound appreciation rate of 4.73 percent suggests that, if $424,000 is the trough, Austin would need about six years—until mid-2031—to return to a $550,000 median, assuming average appreciation going forward.

Interestingly, the top quartile of the market has shown resilience. Homes in the upper 25th percentile have posted year-over-year price gains of 3.7 percent, while the bottom quartile has slipped by 4.6 percent. This widening gap underscores how demand is concentrating in higher-end properties, supported by more stable financing and wealthier buyer pools. Lower-priced segments, more reliant on first-time buyers and tighter lending, continue to bear the brunt of affordability constraints.

Other indicators confirm the market’s slower pace. The absorption rate—the ratio of sold homes to active listings—is just 17.5 percent, far below the historical average of 31.8 percent. The Market Flow Score, which measures turnover on a scale of 0 to 10, stands at 5.5, compared to a long-term norm of 6.6. Both measures tell the same story: homes are moving, but not quickly, and buyers have more breathing room than at almost any time in the last decade.

For buyers, today’s Austin real estate market offers leverage rarely seen during the boom years. High inventory, slower absorption, and widespread price adjustments create opportunities to negotiate aggressively, particularly in the resale sector. For sellers, the key is differentiation: homes that are priced right, move-in ready, and well-marketed still attract interest, while overpricing almost guarantees prolonged market time. For investors, the outlook is mixed. Rental demand remains solid, but with resale prices soft, the long-term play is value appreciation—and as the 25-year compound appreciation rate suggests, recovery may take patience.

Overall, the Austin housing forecast remains cautious. The market has yet to stabilize fully, and until demand begins to outpace supply, price growth will remain limited. Buyers have room to maneuver, sellers must adapt, and agents need to prepare clients for a market defined by competition, negotiation, and realistic expectations.