Austin’s housing market shows continued balance between cautious demand and elevated supply as prices stabilize at mid-2020s levels.
Scroll down to view the full Austin Daily Real Estate Briefing PDF for October 15, 2025.
The Austin real estate market is moving through an extended phase of cautious normalization. As of October 15, 2025, there are 16,445 active residential listings, up 14.3 percent from a year ago. This expansion of available homes reflects a market where supply remains strong and absorption has slowed, keeping conditions firmly in the Contraction Zone of the Activity Index cycle. Pending listings have dipped 4.1 percent year-over-year to 3,953, pushing the Activity Index to 19.4 percent, down from 22.3 percent in 2024. This level of activity places Austin within the “sluggish but stable” category—where homes are still moving but buyer urgency has clearly cooled.
Market Overview
Roughly 59.2 percent of all active listings across the Austin-area MLS have experienced at least one price drop, a clear indicator that sellers are still adjusting to buyer expectations in today’s rate environment. By comparison, the historical average for listings with reductions rarely exceeded 40 percent prior to 2023. Homes are spending an average of 71 days on market, a timeline that reinforces this steady—but slower—pace of absorption.
Inventory now sits at 5.8 months, up 13 percent from 5.11 months a year earlier. While far below the 11-month peaks seen in some outlying markets, Austin proper’s 5.4 months of inventory confirms that the region remains in a buyer-tilted environment. Historically, the Austin market averages 3 to 4 months of supply in equilibrium conditions, meaning today’s inventory represents a 40-to-60 percent surplus of available homes relative to steady-state norms.
Housing Prices and Long-Term Context
The median sold price across the Austin-area MLS is $450,000, down 18.18 percent ($100,000) from the May 2022 peak of $550,000. The average sold price stands at $615,657—roughly 9.7 percent below its May 2022 high of $681,939. In practical terms, this means today’s market continues to hold prices roughly $66,000–$100,000 below peak values depending on the segment.
However, the broader Austin housing forecast remains resilient when viewed through long-term fundamentals. The 25-year compound appreciation rate for the metro is 4.981 percent annually. Even if 2025 represents a cyclical bottom, the median price is projected to return to a peak-equivalent value of $554,280 by early 2030 if historical growth rates resume.
Price performance varies significantly by tier. Lower-priced homes (bottom 25th percentile) are down 4.3 percent year over year with price-per-square-foot declines of 5.2 percent, while the upper quartile has held better—showing a 4.1 percent increase in median price and only a 1.2 percent decline in $ per square foot. This reinforces that affordability sensitivity continues to affect the entry-level market most acutely.
Supply and Demand Dynamics
Cumulative new listings from January through October stand at 43,158, up 1.1 percent year-over-year and nearly 19 percent above the 25-year average. Meanwhile, cumulative pendings ( 35,873 ) are down 6.5 percent year-over-year but still slightly above average for the same period. The imbalance between new listings and pending contracts—a gap of 7,285 units year-to-date—continues to widen, pushing the New Listing-to-Pending Ratio to 0.71, below the 25-year norm of 0.82. This means for every 100 homes going under contract, roughly 141 new listings are entering the market. That pressure keeps inventory rising even without a spike in new construction.
The current Monthly New Listing-to-Pending Ratio of 0.60 further illustrates a market that is absorbing new inventory slowly relative to historical levels. This lag is especially visible in sub-markets like Leander, Liberty Hill, and Georgetown, where inventory growth has outpaced sales velocity by double-digit percentages over the past year.
Regional Trends
Across the Austin metro’s 30 tracked cities, months of inventory ranges from 2.05 to 11.00. Markets like Manchaca and Kyle sit closer to balance, while outlying areas such as Smithville and Burnet show extreme supply conditions indicative of buyer leverage. Within Austin city limits, the median inventory is 5.4 months—slightly above the regional average but stable month to month.
The Activity Index data highlights a mixed phase pattern: 0 cities in Expansion, 5 in Equilibrium, 10 in Softening, 8 in Contraction, and 7 in Freeze. That distribution confirms a region with isolated strength in newer growth corridors but broadly slower absorption across the core. In zip codes such as 78739 (Southwest Austin) and 78727 (North Austin), activity remains strong above 30 percent, while areas like 78702 and 78701 show Activity Index readings below 10 percent, reflecting buyer hesitation and high list-to-sale gaps.
Market Flow and Absorption Metrics
The Absorption Rate for October is 17.49 percent, well below the historic average of 31.76 percent. In simpler terms, fewer than two out of every ten active homes are selling in a given period. This is consistent with other cooling indicators like the Activity Index and the Listing-to-Pending ratio. Meanwhile, the Market Flow Score (MFS) sits at 5.66 on a 0-to-10 scale, down from its historical benchmark of 6.59. That reading suggests a moderately sluggish turnover environment where homes require strategic pricing and longer exposure to find ready buyers.
Buyer, Seller, and Investor Outlook
For buyers, today’s Austin housing environment offers the most leverage since before the pandemic. Inventory levels are ample, competition is limited, and price reductions are common. However, with mortgage rates holding in the 7 percent range, monthly affordability remains the primary constraint. Savvy buyers are targeting homes that have been listed 60 days or longer and negotiating for closing cost concessions and repairs.
Sellers need to acknowledge the reality of market timing. Homes priced accurately in the first two weeks are still selling within 97 percent of list price, but those requiring reductions typically see a final discount of 3 to 5 percent below list. Agents should focus on data-driven pricing strategies and clear communication with clients to avoid “chasing the market down.”
For investors, the market’s retracement from peak values continues to create entry opportunities in select sub-markets. While rents have softened slightly, cap rates are improving as prices flatten and seller motivation increases. Long-term buyers who underwrite based on fundamentals rather than speculative appreciation stand to benefit most as the market grinds toward balance in 2026.
The Outlook Ahead
Looking forward, the Austin real estate forecast calls for continued sideways movement through the winter months. Unless rates drop meaningfully, the region is unlikely to see a return to high-velocity absorption until late 2026. Still, Austin’s fundamental drivers—strong employment, population inflows, and limited new lot deliveries—remain intact. Once inventory declines closer to 5 months and Activity Index rises above 25 percent, the market will be on track to shift from Contraction back toward Softening and eventually Equilibrium.
