Austin Real Estate Market Update – August 28, 2025

The Austin housing market continues to send a clear message: buyers have leverage, sellers are adjusting, and the balance of supply and demand is reshaping expectations. With inventory levels climbing and buyer activity not keeping pace, the latest data shows a market that is moving slower than historical averages, even as affordability improves compared to the 2022 peak.

Market Overview

As of August 28, 2025, Austin’s active residential listings stand at 17,341, just shy of the summer high of 18,146 seen at the end of June. That’s a 15.8% increase from this time last year when inventory was below 15,000. Nearly 59% of homes on the market have already had at least one price drop, underscoring that sellers are competing harder for fewer buyers.

Year-to-date, 37,336 new listings have hit the market, up 5.2% compared to 2024 and a significant 24.2% above long-term averages. This flood of new supply hasn’t been matched by demand. Pending contracts year-to-date total 30,473, which is down 3.2% from last year, even though the raw August pending count of 4,271 is 5.8% higher than last year’s 4,038. In other words, more homes are available and more are being listed, but overall absorption remains sluggish.

The Activity Index, which measures demand relative to supply, is at 19.8%, a drop from 21.2% last year. For context, a healthy balanced market typically tracks closer to the mid-20s. This drop confirms that while buyers are active, they aren’t keeping pace with the expanding supply.

Housing Prices

Price trends continue to reflect the multi-year correction. The average sold price now sits at $593,779, down nearly $88,000 (-12.9%) from the May 2022 peak of $681,939. The median sold price has dropped even further in percentage terms, sitting at $450,000, which is a $100,000 decline (-18.2%) from the same May 2022 peak of $550,000.

Looking back three years, median sold prices are 9.3% lower than they were 36 months ago, showing that this isn’t just a short-term dip but a broader recalibration of values. The correction has hit the lower tier more noticeably than the luxury market. In the bottom quartile, home prices are down 1.2% year-over-year, with price per square foot down 3.3%. At the top end, prices are actually up 7.3% year-over-year, holding steady on a per-square-foot basis.

For homeowners and investors, the long-term view remains steadier. The 25-year compound annual appreciation rate for Austin housing is 4.981%, and if today’s median price of $450,000 represents the “bottom,” then using historical averages it would take about 52 months—until November 2029—for prices to climb back to $550,657.

Regional Trends

Inventory growth isn’t uniform across the Austin area. The city of Austin itself has 5.33 months of inventory, up from 4.90 a year ago, an 8.8% increase. Suburban areas have seen even sharper increases. Smithville’s supply doubled year-over-year, while Jarrell, Burnet, and Leander all recorded inventory growth above 65%. By contrast, markets like Buda, Lockhart, and Taylor have actually seen slight declines in available inventory compared to last year.

These city-level differences matter for buyers and sellers alike. In fast-growing inventory markets, sellers are under heavy pressure to price competitively and offer concessions. In the tighter submarkets, demand is still outpacing supply, giving sellers more room to hold firm on pricing.

List-to-Sale Price Performance

One of the clearest signals of today’s market is the high share of price reductions. With 59% of active listings marked down at least once, buyers are negotiating aggressively and sellers are adjusting expectations to secure contracts. This is showing up in the absorption metrics: the sold-to-active ratio is just 13.4%, well below the historical average of 31.8%, reflecting how much more difficult it is to move homes compared to past years. The Market Flow Score (MFS), a broad measure of turnover and demand strength, sits at 3.75, well below the historical average of 6.59. This reinforces the idea that while the Austin housing forecast remains positive long term, the near-term conditions heavily favor buyers.

Peak Value Trends

Austin home values remain well below the frenzied highs of 2022, and the correction has now stretched into more than two years. The median price decline of 18% is steep but not unusual compared to other overheated U.S. markets. Importantly, values have stabilized in recent months, suggesting that the worst of the drop may be behind us, though recovery is likely to be gradual rather than sharp. For buyers, this market represents opportunity: more choices, greater negotiating leverage, and prices that are significantly below the highs of just three years ago. For sellers, it is a reminder that pricing realistically and preparing homes well is essential to stand out in a crowded market.

Scroll down to view the full Austin Daily Real Estate Briefing PDF for August 28, 2025.

Embedded PDF: Austin Daily Real Estate Briefing for August 28, 2025 — includes updated statistics on inventory, pricing, buyer demand, and market trends across the Austin area.

FAQ

1. Is the Austin housing market favoring buyers or sellers in August 2025?

The Austin market currently leans toward buyers. With 17,341 active listings and nearly 59% showing at least one price drop, sellers are competing harder to attract buyers. The absorption rate of 13.4% is well below the historical average of 31.8%, and Months of Inventory has risen to 6.17 compared to just 5.30 last year. This means buyers have more choices and stronger negotiating power.

2. How do current Austin home prices compare to the peak in 2022?

Median and average prices are both well below their May 2022 highs. The median sold price is now $450,000, down 18.2% from the peak of $550,000, while the average sold price is $593,779, nearly 13% lower than the $681,939 high. This correction has created opportunities for buyers to purchase at more affordable levels, though recovery is expected to be gradual.

3. What does the Activity Index tell us about Austin housing demand?

The Activity Index, which measures how quickly inventory is being absorbed, stands at 19.8%. That’s lower than last year’s 21.2% and well below healthier historical averages. While pending sales are slightly higher year-over-year, cumulative pending contracts are down 3.2% through August, showing that buyer demand hasn’t kept up with the flood of new listings.

4. How does today’s Austin real estate market compare to long-term trends?

Looking at the 25-year compound appreciation rate of 4.981%, Austin housing has a strong long-term growth record. Even after the correction, median prices remain substantially higher than they were five or ten years ago. However, compared to long-term averages, the current New Listing-to-Pending ratio of 0.70 is still below the 25-year norm of 0.82, reflecting softer demand relative to supply.

5. What’s the outlook for the Austin real estate market heading into 2026?

Based on today’s data, the short-term outlook calls for continued buyer-friendly conditions, with inventory expected to remain above 17,000 listings through the fall. Long-term projections are more optimistic: if historical appreciation rates hold, today’s median price of $450,000 could climb back to $550,657 by late 2029. This makes Austin real estate attractive to investors and buyers willing to take a long-term view, even as the near-term market remains slower.

Have a Question or Want to Dive Deeper?

If you’d like a custom breakdown of the data, want help interpreting today’s market trends, or just have a question about buying or selling in Austin, let us know. Fill out the form below and a member of our team will get back to you promptly.