The Austin housing market continues to show signs of imbalance, with rising inventory and tempered buyer activity shaping today’s conditions. While more homes are available than last year, demand remains subdued, keeping leverage tilted in favor of buyers.

Market Overview
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As of August 29, 2025, there are 17,430 active residential listings across the Austin-Area MLS. This is 16.2% higher than the 15,001 listings recorded at this time in 2024. Although inventory has eased slightly from the late-June high of 18,146, today’s figure still represents one of the most elevated supply levels in years. Nearly 59% of all listings have seen at least one price reduction, a clear signal that sellers are being forced to adjust expectations to compete in a crowded marketplace.

Cumulative new listings from January through August stand at 37,535, which is up 5.8% year over year and almost 25% above the long-term average. That surge in listing activity has not been matched by contracts, as pending listings total 30,600 so far this year, down 2.8% compared to 2024. This imbalance—37,500 homes listed against only 30,600 going under contract—leaves a year-to-date gap of nearly 7,000 homes that remain unsold.

Housing Prices

Price performance reflects the strain between supply and demand. The average sold price in August 2025 is $591,132, which is down 13.3% from the May 2022 peak of $681,939. The median sold price has fallen even further, from a high of $550,000 in May 2022 to $450,000 today, an 18.2% decline or $100,000 drop in just over three years. When compared to prices 36 months ago, today’s median is down 9.3%.

Looking forward, long-term appreciation trends provide perspective. Over the past 25 years, Austin’s compound annual growth rate is 4.98%. Using that trajectory, if today’s $450,000 median price represents the “bottom” of this correction, it would take about 52 months—into late 2029—to return to the prior $550,000 peak.

Regional Trends

The distribution of price shifts highlights uneven performance across Austin’s submarkets. In the past year, the top quartile of home prices rose 7.7% while the bottom quartile fell 2.3%. This “barbell” effect shows that luxury and higher-end properties have been more resilient, while entry-level homes—typically most sensitive to mortgage rates—have borne the brunt of price pressure.

City-by-city analysis also reveals divergence. Eleven cities in the metro reported year-over-year price gains, but nineteen recorded declines. Inventory expansion has been most dramatic in areas like Smithville, Jarrell, and Cedar Creek, where supply has doubled or more since last August. In contrast, markets like Elgin, Taylor, and Manchaca are showing falling inventory, suggesting more localized demand.

List-to-Sale Price Performance

Negotiation leverage continues to shift away from sellers. The absorption rate, measured as the ratio of sales to active listings, is just 14.3% compared to a long-term average of 31.8%. This signals that homes are selling at less than half the pace of a balanced market. The Market Flow Score, another measure of demand normalized on a 0-10 scale, currently stands at 4.08, well below the historical average of 6.59. Both figures underscore that homes are sitting longer, forcing sellers to make concessions.

The Activity Index, which measures contract activity relative to inventory, has slipped to 19.4% from 21.2% a year ago, an 8.4% decline. That means fewer buyers are engaging, even as options expand. New construction contracts show a healthier rate at 26.9% compared to 16.5% for resales, a sign that builder incentives and rate buydowns are still drawing demand away from the resale market.

Peak Value Trends

Compared to the frenzied highs of 2021–2022, today’s Austin real estate market looks dramatically different. Months of Inventory now stands at 6.19 months, up from 5.32 last August—a 16.4% year-over-year rise. The 25-year average for the New Listing-to-Pending ratio is 0.82, but today it sits at 0.70, confirming that more listings are entering than buyers are absorbing.

Sales density also tells the story of cooling momentum. From January through August, 20,597 homes have sold, down 4.5% from last year. On a per-population basis, sales equate to 807 closings per 100,000 residents, which is not only 6.7% lower than 2024 but also more than 21% below the long-term average. When measured against the Realtor base, sales are at 1,103 per 1,000 agents, showing the market is stretched thin with more agents competing for fewer closings.

Outlook

Taken together, the data points to an Austin housing market that remains in correction mode. Inventory continues to climb while buyer demand lags, pushing leverage into the hands of those entering the market today. Median prices have dropped 18% from their peak, and nearly 60% of listings have cut prices at least once. Yet long-term appreciation rates suggest Austin is still positioned for recovery once interest rates ease and demand re-enters. For now, buyers benefit from choice and negotiation power, while sellers must adapt with pricing discipline and stronger marketing strategies.

Scroll down to view the full Austin Daily Real Estate Briefing PDF for Friday, August 29, 2025.​