The Austin housing market is navigating through a critical adjustment phase, where rising supply and moderated demand are reshaping both pricing and absorption trends.

Market Overview

As of Friday, August 22, 2025, active residential listings stand at 17,419 across the Austin-area MLS. This level of inventory is 15.4% higher than the 15,090 listings available at this time last year, signaling a noticeable expansion of supply. While still below the late-June high of 18,146, today’s count remains elevated compared to recent historical norms, providing buyers with more choices than in past years.

Nearly 60% of all active listings have had at least one price drop, underscoring the challenges sellers face in pricing homes competitively. This adjustment has become a defining feature of the current Austin real estate forecast, reflecting a market that has shifted away from peak-era pricing power and into a more negotiation-driven environment.

Housing Prices

Prices remain well below the highs of May 2022, when the median sold price peaked at $550,000. Today, the median sits at $457,000, a 16.9% decline from that peak. The average sold price has followed a similar trend, now at $605,503, down 11.2% from its record high.

Looking at appreciation rates, the Austin market’s long-term 25-year compounded annual growth is 5.045%. If today’s median of $457,000 represents the bottom of the correction, then at this rate of appreciation it would take until mid-2029 for prices to return to their previous peak levels near $552,000. This projection gives both buyers and investors a realistic timeline of recovery while grounding today’s affordability in historical perspective.

Price segmentation also shows divergence between tiers. Homes in the top 25th percentile have managed to grow 6% year-over-year, while the bottom 25th percentile has seen slight declines in both price and price per square foot. This split highlights how higher-end properties are holding firmer compared to entry-level and mid-range homes, which are seeing more sensitivity to interest rates and affordability constraints.

Regional Trends

The months of inventory across the Austin market has climbed to 6.20, up 16.2% from 5.33 a year ago. This figure reflects a market leaning toward neutrality, but with pockets that still favor buyers. Within Austin proper, inventory is up 7.7% year-over-year, while some outlying cities such as Jarrell, Liberty Hill, and Marble Falls have seen inventory more than double.

On the other hand, a few markets like Manchaca and Hutto have actually seen inventory levels drop compared to earlier in the year. This variation reinforces the point that while the overall Austin housing forecast indicates balance, certain submarkets still carry conditions closer to a buyers’ market while others remain tight.

Sales density offers further insight. From January through August, a total of 20,585 homes have sold, which is 4.5% fewer than last year but still 6.3% above long-term averages. However, when measured per 100,000 residents, sales are down 6.7% year-over-year and sit over 21% below historical norms. This confirms that while volume is holding up, population growth has outpaced sales activity, cooling the turnover rate.

List-to-Sale Price Performance

The Sold-to-Active ratio is at 16.21%, well below the historical average of 31.88%. This measure of absorption illustrates a slower-moving market where listings are piling up relative to closed sales. For context, markets with ratios above 20% generally favor sellers, while those below 10% tilt strongly toward buyers. Today’s 16% reading underscores a neutral-to-buyer-skewed environment.

The Activity Index, another forward-looking measure, stands at 19.7% compared to 21.3% a year ago, marking a 7.4% decline. This decline suggests that buyer urgency has softened, with resale properties seeing significantly weaker activity than new construction. Currently, resale homes are recording an index of 16.6% compared to 27.6% for new construction, highlighting builders’ aggressive incentives and ability to move inventory faster than private sellers.

Peak Value Trends

The ongoing correction has now stretched more than three years from the May 2022 peak. With median prices still nearly $93,000 below their high, the Austin real estate forecast remains cautious in the short term. For many buyers, this represents a moment of improved affordability, especially with nearly 60% of listings having undergone price reductions.

For sellers, however, the picture is more complex. While demand is steady enough to prevent a freefall in values, it is clear that pricing strategies must adapt to elevated supply and longer market times. Investors, too, will note the widening gap between new listings and pending contracts, which year-to-date totals 8,372 more listings than contracts—a sign that absorption is lagging supply.

The Market Flow Score sits at 4.42, well below the long-term average of 6.60. This low score reinforces the idea of a sluggish, supply-heavy market. While it is not collapsing, it is also far from the rapid turnover markets experienced just a few years ago.

Conclusion

Overall, today’s Austin housing update reflects a market that is recalibrating after years of extreme swings. Supply is abundant, demand is moderate, and prices are stable but below their peaks. Buyers benefit from increased selection and negotiating power, while sellers must remain realistic about pricing. For agents, the lesson is clear: localized analysis is key, as conditions vary dramatically between neighborhoods and price points.

Scroll down to view the full Austin Daily Real Estate Briefing PDF for August 22, 2025.​