Entry-Level Homes Fall Below $300K

To understand the bottom 10th percentile of the Austin real estate market, imagine lining up every home for sale from the cheapest to the most expensive. With 4,773 active listings today, the first 477 homes in that line — the least expensive 10 percent — make up the bottom 10th percentile. The price at this dividing line tells us where affordability truly begins.

This measure is important because it cuts through averages that can be skewed by luxury homes. The bottom 10th percentile shows the price point where buyers entering the market can realistically expect to find homes. For sellers, it defines the ceiling for budget-sensitive buyers, and for investors, it identifies the segment most likely to deliver stable rental demand and cash-flow opportunities.

In October 2024, the bottom 10th percentile of active listings in Austin stood at $342,980. One year later, on October 3, 2025, that number has dropped to $299,900. On the sold side, the bottom 10th percentile also reset lower, from $319,300 in 2024 to $299,000 in 2025.

This means that 10 percent of all homes for sale in the City of Austin are priced at $299,900 or less. Out of today’s 4,773 active listings, nearly 480 homes fall into this category. For buyers, that’s the broadest affordability window the Austin housing market has offered in years.

Why Entry-Level Homes Matter in the Austin Real Estate Market
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The 10th percentile captures the dividing line between the lowest-priced homes and the rest of the market. It is the cleanest measure of affordability and helps track how the entry level shifts year to year. In 2024, buyers needed at least $343,000 to enter the market. In 2025, they need just under $300,000.

On the sold side, the data confirms that these homes are not just being listed but are actually selling at this level. Last year, 10 percent of homes closed at $319,300 or less. This year, the line is $299,000. The closeness between active and sold prices shows sellers are pricing realistically and buyers are transacting without stretching beyond asking.

Market Dynamics at the Bottom 10th Percentile
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The alignment between asking and selling is unique to the entry-level segment. In the luxury tier, sellers continue to list homes near $1.8 million, while buyers are only closing deals closer to $1.3 million — a wide disconnect. But at the bottom, the story is balance: $299,900 active versus $299,000 sold.

This near-perfect alignment suggests a natural market floor has formed around $300,000. It is where supply and demand are meeting most efficiently. With inventory up 12.3 percent year-over-year — from 4,249 active listings in 2024 to 4,773 today — competition among sellers has grown, yet the bottom tier remains the most stable point in the market.

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What This Means for Buyers
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For buyers, especially first-time homeowners, the Austin housing market is more accessible than it has been in years. The reset from $343,000 in 2024 to $299,900 in 2025 means a $43,000 drop in the cost of entry. This equates to nearly 480 homes available under the $300,000 threshold, expanding the pool of options and reducing the pressure to overbid.

What This Means for Sellers
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For sellers in the entry-level range, the message is clear: the market has set a hard ceiling around $300,000. Pricing significantly above that risks losing visibility, while pricing at or just under that figure positions a property to sell quickly. The data shows buyers are not pushing higher in this segment, making disciplined pricing essential.

What This Means for Investors
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For investors, the $275,000 to $300,000 band is particularly compelling. Properties in this range often yield stronger rental returns relative to purchase price and carry less downside risk than higher-end investments. With demand steady at the low end, and both asking and sold prices converging around $300,000, the entry-level segment offers more predictable performance.

Outlook for the Austin Real Estate Market
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The bottom 10th percentile of the Austin housing market has reset to a $300,000 floor in 2025. This floor represents a rare balance between buyer affordability, seller pricing realism, and investor opportunity. As inventory continues to grow, this threshold may be tested, but for now, it marks the most stable and transparent part of the Austin real estate market.

FAQ

What does the bottom 10th percentile mean in real estate?

It’s the price point below which the cheapest 10 percent of homes fall. With 4,773 listings in Austin today, the bottom 10th percentile of $299,900 means about 480 homes are listed at that price or lower.

Why is the 10th percentile important?

It highlights true affordability by showing the dividing line for entry-level homes. Unlike averages that can be skewed by expensive listings, the 10th percentile reflects the price point where first-time buyers and budget-conscious investors can find real opportunities.

Has affordability improved in Austin in 2025?

Yes. The entry-level threshold dropped from $342,980 in 2024 to $299,900 in 2025. That’s a $43,000 reduction in one year, making the Austin housing market more accessible for first-time buyers.

Are sellers overpricing entry-level homes?

Not in this segment. Active listings average $299,900 while sold homes average $299,000, showing a tight alignment. Sellers are pricing realistically, and buyers are closing close to list price.

Is this a good time for investors to buy entry-level homes?
Yes. Homes under $300,000 often deliver stronger rental yields and lower downside risk. With sold and active prices aligned, investors can enter this segment with more confidence in predictable returns.​