Austin’s housing market continues to walk a fine line between supply-heavy conditions and sluggish buyer demand, creating a challenging but opportunity-filled environment for those paying attention to the data.

Scroll down to view the full Austin Daily Real Estate Briefing PDF for September 26, 2025.
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As of today, active residential listings sit at 16,878, which is 14.2% higher than last year and still elevated compared to historical averages. While inventory levels have eased slightly from the summer high of 18,146, the fact that nearly 59% of homes have experienced at least one price drop shows sellers are under pressure to adjust to current realities. For buyers, this means more choices and negotiating leverage. For sellers, it highlights the need to price competitively from the start if they want to capture the shrinking pool of active buyers.

Pending listings stand at 4,066, a 3.8% year-over-year decline. On a cumulative basis from January through September, pendings are down 3.6% compared to last year, even though new listings are up 4.5% and running 23.3% above long-term averages. This mismatch between supply and demand underscores one of the core challenges in today’s Austin real estate market: more homes are coming online, but fewer are going under contract. The result is a widening gap of 7,176 between new listings and pending sales so far this year.

The Activity Index, which measures the share of actives that are moving into pending status, has dropped to 19.4% compared to 22.2% a year ago. That represents a 12.7% decline in overall market pace, with resale activity trailing well behind new construction. Builders have leaned heavily on incentives and rate buydowns to maintain traction, reflected in their stronger Activity Index of 27.14% compared to 16.37% for resale. This split indicates that buyers remain motivated by affordability tools rather than simply price positioning.

Months of Inventory has climbed to 5.96, up from 5.27 this time last year. At nearly six months, Austin sits just on the edge of a neutral market, leaning toward favoring buyers. Historically, the city has operated closer to 3–4 months of inventory, which kept upward pressure on prices. The shift to higher inventory means buyers have more breathing room, and sellers must be more realistic about pricing if they expect movement.

Sales performance reflects this reality. In September, 2,303 properties closed, bringing year-to-date sales to 22,882—down 4.3% from last year, even though the total still runs 5.5% above the long-term average. When adjusted for population, however, sales density is falling short. So far this year, the metro has seen 895 sales per 100,000 residents, which is 6.6% lower than last year and 22.2% below the 25-year average. For agents and brokers, this drop means more competition for each transaction, while investors may view it as evidence of suppressed demand that could set up longer-term opportunities once affordability normalizes.

Prices tell a similar story of correction and adjustment. The average sold price in September was $559,958, down 17.9% from the May 2022 peak of $681,939. The median sold price now sits at $430,000, representing a 21.8% decline—or $120,000 below the peak. Importantly, when tracking against 36 months prior, median pricing is still 8.5% lower. These numbers confirm that the market is in recovery mode but not yet back on a growth trajectory.

Looking at price tiers, the bottom 25th percentile of homes is still experiencing year-over-year declines of 5.8% in pricing and 4.3% in price per square foot. By contrast, the top 25th percentile has gained 4.1% in median price and 1.8% in price per square foot. This divergence shows how higher-end homes with less affordability pressure are stabilizing more quickly than entry-level segments, where buyers remain highly rate sensitive.

On a citywide basis, 10 local markets posted year-over-year median price gains, while 20 saw declines. This uneven performance highlights the hyper-local nature of today’s Austin housing forecast, where neighborhood-level supply and demand matter more than broad market averages.

Looking ahead, the 25-year compound appreciation rate for Austin real estate sits at 4.79%. Assuming today’s $430,000 median represents the bottom of the correction, it would take about 66 months—or until February 2031—for prices to recover to the prior peak of $550,394. That timeline reinforces that today’s buyers must think long term. Sellers waiting for a full recovery should recognize that “waiting it out” likely means waiting years, not months.

Two other key metrics underscore the sluggish conditions. The absorption rate—measured as sold-to-active ratio—is just 12.2%, far below the historical average of 31.7%. The Market Flow Score, a normalized 0-to-10 measure of turnover and demand, is currently 3.03 compared to a long-term average of 6.58. Both metrics reflect the reality of a market where supply is plentiful but buyer urgency is limited.

For buyers, this is one of the most favorable environments in recent years. With inventory high, price drops common, and sellers motivated, there’s room to negotiate and find value, especially in the resale market where incentives are fewer. For sellers, success will depend on embracing competitive pricing strategies rather than clinging to 2022 valuations. Investors should be watching closely: while cash flow returns are still compressed by high rates, long-term entry points look attractive given the 4.79% historical appreciation rate. And for real estate agents, the data confirms that market share will come down to skills in pricing, negotiation, and helping clients see through the noise to the underlying fundamentals.

Austin housing today is a market in transition. Supply is strong, demand is cautious, and the gap between the two has widened. That creates both risk and opportunity, depending on how well participants align their strategies with the data.​