Austin Real Estate Market Update – July 31, 2025

Austin Housing Market Holds Elevated Supply Amid Sluggish Buyer Demand

The Austin housing market remains in a period of extended supply growth and moderate buyer activity as we close out July 2025. Active residential listings sit at 17,767, just 309 units shy of the late-June peak of 18,076, marking a 17.7% increase compared to this time last year. This sustained high inventory is creating competitive conditions for sellers, with 59% of homes requiring at least one price reduction to attract buyers. While new listings have surged to 33,767 year-to-date—a 7% increase over 2024 and 27.4% above the long-term average—pending sales have only grown by 3.4%, underscoring a widening gap between supply and demand.

Pending activity reached 4,417 homes under contract, pushing the cumulative total for 2025 to 26,950. Despite a modest month-over-month gain, this figure is down 3.6% compared to last year, and the overall Activity Index has slipped to 19.9%, nearly 10% lower than 2024 levels. With new construction representing 28.04% of all pending contracts, builders are still competing aggressively against the resale market, often leveraging incentives to move standing inventory. Resale activity lags considerably at 16.92%, a sign of buyer caution as affordability challenges persist.

The market’s supply-demand imbalance continues to show up in the Months of Inventory metric, now at 6.35 months, an 18.8% increase year-over-year. Historically, Austin’s 25-year average listing-to-pending ratio sits at 0.81, but this year’s cumulative ratio is just 0.69, highlighting a slower absorption rate. Sales density reflects these conditions, with only 702 homes sold per 100,000 residents year-to-date, 20.4% below the long-term average and 6.9% under 2024 levels. Realtor-to-sales density has also softened, with just 962 closed transactions per 1,000 agents, reflecting a market that is not providing the same transactional volume as previous years.

Price trends remain under pressure. The median sold price is now $444,990, a $105,000 decline from the May 2022 peak of $550,000, representing a 19.09% correction. Average sold prices show a similar trend, down 14.7% from their highs, landing at $581,695. Over the past 36 months, median prices have fallen 13.59%, aligning with expectations in a drawn-out correction cycle. Using Austin’s long-term 25-year compound appreciation rate of 4.934%, it would take approximately 55 months—until January 2030—for median prices to recover to prior peak levels, assuming a steady appreciation path without further market disruptions.

Segmented price performance shows continued pressure on lower-tier homes, with the bottom 25th percentile of the market experiencing a 1.36% price decline and a 3.6% reduction in price per square foot year-over-year. The top quartile fared slightly better, with a 0.52% price gain but still a 1.75% reduction in price per square foot, indicating even luxury properties are adjusting pricing to meet tempered demand.

The sold-to-active ratio remains a key signal of current conditions. At 13.55%, it is less than half the long-term historical average of 31.85%, firmly placing Austin in a buyer’s market where inventory far outpaces buyer activity. The Market Flow Score has stabilized at 3.07 on a 0–10 scale, compared to a historical average of 6.60, reflecting a slow-moving market with excess supply and cautious buyer behavior.

Overall, July ends with clear signs of a rebalanced market where sellers must compete aggressively on pricing and concessions to attract offers. The large inventory base, weak absorption rates, and extended timeframes for market recovery point to continued downward pressure on pricing through the remainder of 2025 unless buyer demand meaningfully accelerates.

Scroll down to view the full Austin Daily Real Estate Briefing PDF for July 31, 2025.

Embedded PDF: Austin Daily Real Estate Briefing for July 31, 2025 — includes updated statistics on inventory, pricing, buyer demand, and market trends across the Austin area.

Top 5 Questions About the Austin Housing Market – July 31, 2025

1. Why is Austin's housing inventory remaining so high despite more homes going under contract?

Inventory growth in Austin is being fueled by a combination of elevated new listings and slower absorption rates. Year-to-date listings are 27.4% above the long-term average, while pending sales are only 5% above trend, leaving thousands of additional homes on the market. Builders are contributing heavily to supply, with new construction making up 28% of all pending contracts. This elevated supply is outpacing buyer demand, leading to an excess that keeps total inventory near record highs.

2. What is causing median home prices to remain nearly $105K below the 2022 peak?

Price corrections are tied to affordability constraints, higher mortgage rates, and a saturated inventory pool. As buyers gain more options, competition for each listing diminishes, forcing sellers to make price cuts. The median price of $444,990 reflects this ongoing recalibration. Historically, Austin appreciated at 4.9% annually, but the market has yet to stabilize, meaning it may take more than four years to fully return to prior peak values if current conditions persist.

3. How does Austin's buyer activity compare to previous years?

The Activity Index is at 19.9%, down 9.7% from last year, showing reduced urgency among buyers. Pending contracts are slightly up year-over-year, but not enough to absorb the surge in new listings. Sales density per 100,000 residents has dropped 20% below long-term norms, showing that even with population growth, transaction activity is lagging historical patterns. This aligns with national headwinds of affordability challenges and buyer hesitancy.

4. Are all price ranges in Austin being affected equally?

No, the lower 25th percentile of the market has seen the largest drop in price per square foot, down 3.6% year-over-year. While top-tier properties held their price levels slightly better, they still saw a 1.75% decline in price per square foot, signaling that pricing pressure is widespread but more acute in lower-priced segments. This is likely due to tighter affordability for entry-level buyers and increased competition among listings in the lower price band.

5. Is Austin still considered a buyer’s market?

Yes, the data strongly supports a buyer’s market. Months of Inventory at 6.35, a sold-to-active ratio of just 13.55%, and a Market Flow Score of 3.07 indicate excess supply and slower market velocity. Buyers today have leverage, with ample choices and a high rate of price reductions, while sellers face extended listing times and greater competition to secure a contract.

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