The Austin housing market continues to move through its correction phase, showing signs of stabilization in some areas while maintaining clear challenges in others.

Scroll down to view the full Austin Daily Real Estate Briefing PDF for September 4, 2025.

The number of active residential listings today stands at 16,993. This is down from the June 30 high of 18,146 but still 16.9% higher than the 14,539 listings recorded a year ago. Inventory levels remain historically elevated, and with 58% of all active listings having experienced at least one price reduction, sellers are adjusting expectations to align with market realities. This higher level of supply is reshaping negotiations and pricing power across Austin real estate.

Market Overview
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From January through August, 37,819 new listings have entered the market. This figure is up 6.6% compared to last year and sits an impressive 25.7% above the long-term average. Pending contracts, however, have not kept pace. Cumulative pending listings for the same period reached 31,038—down 1.4% year-over-year, though still 6.2% above the long-term average. This imbalance between new supply and pending demand has created a gap of 6,781 listings year-to-date, keeping the market tilted toward buyers.

The Activity Index, which measures the share of inventory that is going under contract, sits at 19.1% compared with 21.6% this time last year. That 11.2% decline underscores slower absorption of listings, especially in the resale market, which is recording an Activity Index of only 16.4%. In contrast, new construction is performing better with a 26.1% Activity Index, suggesting builders are finding more ways to attract buyers through pricing incentives and concessions.

Housing Prices
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Price performance remains the most visible part of the Austin housing forecast. The average sold price in August was $586,558, representing a 13.99% decline from the May 2022 peak of $681,939. The median sold price landed at $440,452, down 19.92% from the peak of $550,000 in May 2022. In dollar terms, that’s about a $95,000 decline on the average sale and $110,000 on the median.

Compared to 36 months prior, today’s median is 11.2% lower, underscoring how significant this correction has been over a three-year horizon. Long-term projections, however, offer perspective. With Austin’s 25-year compound appreciation rate of 4.891%, a return to peak pricing is estimated to take about 59 months, or until mid-2030, assuming the current bottom holds.

Not all parts of the market are moving in the same direction. Homes in the bottom 25th percentile of pricing fell by 3.2% year-over-year, while the top 25th percentile actually gained 6.2%. This widening split highlights the continued resilience of higher-end buyers even as affordability challenges weigh on entry-level demand.

Regional Trends
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Months of Inventory rose to 6.03, up 16.7% from 5.16 a year ago. By historical standards, this is high—buyers have more options, and sellers face longer marketing times. City-by-city comparisons show Austin proper holding 4.97 months of supply, down 6.4% from last year, but many surrounding communities are posting significant increases. Smithville’s inventory jumped 172.8% year-over-year, and Cedar Park’s doubled compared to January. These disparities suggest suburban markets are experiencing the sharpest adjustments, while Austin itself is showing early stabilization.

Sales activity continues to lag. From January through August, 20,454 homes sold, representing a 5.1% year-over-year decline. Sales per 100,000 residents dropped 7.4% from last year and now sit 22.1% below long-term averages. Realtor productivity has also softened, with 1,096 sales per 1,000 agents year-to-date, down 25.8% from historical norms.

List-to-Sale Price Performance
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Absorption—the share of inventory sold versus active listings—sits at 17.2%. Historically, Austin’s average is 31.8%. This gap is significant, showing the degree of buyer hesitation and oversupply currently in the market. The Market Flow Score, a normalized 0-10 indicator of momentum, registered at 5.30. That’s below the long-term average of 6.60, reinforcing the view that while conditions are not collapsing, they remain sluggish and tilted toward buyers.

Peak Value Trends
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The broader correction remains clear when compared to May 2022 peak values. Median prices are still down nearly 20%, and while upper-tier homes show resilience, lower-tier homes continue to struggle. The affordability squeeze, compounded by higher interest rates, is limiting first-time buyer activity. Investors, too, are being more cautious given slower rent growth and the weight of higher financing costs.

Looking ahead, Austin’s real estate market forecast points to gradual recovery rather than a sudden rebound. Elevated inventory levels, soft absorption, and a still-wide gap between new listings and pendings suggest buyers will retain leverage in negotiations for the near term. Sellers who remain flexible on pricing will find success, while those holding to peak valuations are likely to sit longer on the market.​