Austin’s housing market continues to walk a fine line between cooling supply and steady demand — with listings up, pendings softening, and pricing still down more than 24% from peak levels.
Scroll down to view the full Austin Daily Real Estate Briefing PDF for October 6, 2025.
The Austin real estate market opened October with a visible shift in balance. Active residential listings stand at 16,546, up 13.7% from this time last year, though still below the summer high of 18,146 recorded on June 30. Nearly 59% of all active listings have had at least one price drop, reinforcing that sellers are continuing to adjust expectations in a competitive environment. While new listings have slowed slightly year-over-year, overall supply remains well above the historical norm, and absorption remains sluggish — a theme consistent throughout 2025.
Market Overview
Compared to last fall, inventory growth has outpaced pending activity, resulting in a softer Activity Index of 18.7%, down from 21.6% a year ago. That’s a 13.8% drop in market activity, signaling that buyers remain cautious and selective. Pending listings are down 5.6% year-over-year, while cumulative pendings for the year — 34,765 — sit nearly 9.4% below 2024 and slightly below the 25-year average.
This is important because the New Listing-to-Pending Ratio, a key leading indicator of balance between supply and demand, remains below equilibrium. The current monthly ratio sits at 0.37, while the year-to-date ratio holds at 0.70, compared to a 25-year average of 0.82. In other words, for every 100 new listings coming to market, only about 70 have gone under contract — a clear sign that supply continues to outrun demand.
Housing Prices and Market Depth
Prices have continued to stabilize after two years of correction but remain well below their 2022 peaks. The average sold price for September closed at $550,131, marking a $132,000 decline (-19.3%) from the May 2022 high of $681,939. The median sold price now sits at $417,500, a 24.1% decline (-$133,000) from that same peak.
Looking at historical appreciation, the 25-year compound growth rate for Austin real estate is 4.666% per year. If the market has truly reached its pricing floor at today’s median of $417,500, it would take roughly 76 months — until December 2031 — to return to a peak value of $550,000 at that rate of appreciation. That long-term trajectory reinforces that Austin’s price correction is not a temporary dip; it’s part of a cyclical reset that’s still seeking new equilibrium.
Regional Trends and Price Segmentation
The data also reveals a widening gap between market tiers. The bottom 25th percentile of homes saw prices decline 2.9% year-over-year, while the top 25th percentile actually rose 2.8%. That divergence illustrates how higher-end inventory has found firmer footing, while affordability-driven segments continue to absorb most of the downward pressure.
Out of 29 tracked cities, nine have posted median price gains year-over-year, while 20 remain down. Markets such as Leander, Georgetown, and Liberty Hill continue to show inventory expansion, while Austin, Buda, and Pflugerville remain relatively stable. The result is a patchwork market — not a uniform slowdown, but a localized recalibration that depends heavily on price point and geography.
List-to-Sale and Inventory Performance
Austin’s Months of Inventory has climbed from 5.19 last year to 5.86 today, a 12.9% increase. City-by-city data shows that while some markets like Austin proper (5.30 months) and Lakeway (5.63 months) are near neutral, others such as Liberty Hill (6.44 months) and Georgetown (4.90 months) are trending toward buyer-favoring conditions. Historically, Austin’s 25-year average sits closer to 4.5 months, meaning today’s market is carrying about 30% more supply than what’s typical for balance.
The absorption rate — the share of active listings that actually sell within a given period — is now 17.1%, compared to a historical average of 31.8%. That’s a striking slowdown. Simply put, homes are sitting longer, and fewer are converting to sales. The Market Flow Score (MFS) — Team Price Real Estate’s proprietary measure of turnover and efficiency — currently reads 5.44, down from its long-term average of 6.59. It’s not a stagnant market, but one that’s clearly moving slower, with buyers dictating more of the pace and terms.
Transaction Volume and Buyer Demand
So far this year, 23,094 homes have sold, which is 3.4% below 2024’s pace but still 6.4% above the long-term average. When adjusted for population growth, however, the story shifts. Austin’s sold-per-capita rate (903 sales per 100,000 residents) is 21.5% below its historical average, showing that overall participation remains muted even as total volume looks decent on paper.
When measured by agent count, there’s been a modest improvement — 1,235 sold per 1,000 Realtors, up 0.9% from last year — suggesting that fewer agents are producing slightly more volume individually, likely due to the exit of less-active agents from the industry since 2022.
New Construction vs. Resale Dynamics
The new construction segment continues to represent a growing share of total pending activity, with 24.7% of pendings from new homes compared to 16.3% for resale. Builders have maintained leverage through incentives, rate buydowns, and price adjustments that private sellers can’t always match. This gap is keeping pressure on the resale market, especially in the $350,000–$500,000 range, where buyers can often choose between new and existing homes with similar payments.
For resale sellers, the message is clear: buyers are shopping value, not just price. Homes that are well-prepared, correctly priced, and located in stable school districts continue to attract attention. Those that miss the mark — even slightly — are joining the nearly 60% of listings that have already reduced their price.
Forward-Looking Outlook
From an analyst’s lens, Austin’s market remains fundamentally healthy but cyclical. Supply is elevated, demand is steady but not urgent, and prices appear to have found their footing. Historically, market recoveries in Austin follow a similar pattern: inventory builds, pendings flatten, and prices find a floor before gradual re-acceleration begins.
Assuming macroeconomic stability — particularly in interest rates and employment — the local market is positioned for a modest improvement heading into 2026. The combination of solid job growth, continued in-migration, and affordability improvements relative to 2022 suggests that Austin is rebuilding a new base, not collapsing. But it will take patience; data implies a 6-year climb back to previous highs, not a quick rebound.
What It Means for Each Segment
For buyers, this remains one of the most negotiable markets in recent memory. Inventory is abundant, and more than half of sellers are signaling flexibility through price reductions. For sellers, pricing discipline is everything — listings that enter the market aligned with comparable sales are the ones closing, while aspirational pricing is simply burning days on market.
For investors, today’s data presents clear opportunity. With prices still down 20–24% from peak and yields improving relative to Treasury rates, acquisition conditions are quietly favorable. Cash-flow-driven investors, particularly in the outer rings, are finding properties that pencil again at 6–7% cap rates — conditions unseen since 2018. And for agents, this is the market that separates those who read the data from those who react to headlines. The clients who get clarity — not hype — will move confidently, and that’s where we add value.
Final Takeaway
Austin’s housing market has cooled from its pandemic highs but continues to operate with stability beneath the surface. More listings, longer timelines, and measured buyers have created a balanced — even data-driven — environment. Whether you’re buying, selling, or investing, understanding this market’s rhythm matters more than ever. The numbers show that opportunity hasn’t disappeared; it’s simply shifted.
