The Austin housing market continues to shift as inventory builds and pricing patterns show a widening gap between different tiers of the market.

Market Overview

On August 26, 2025, active residential listings in the Austin metro stood at 17,334, a 15.3% increase from the 15,030 available at this time in 2024. While this total remains below the recent peak of 18,146 recorded in late June, it is clear that supply remains elevated compared to historical averages. Notably, 59.2% of all active listings have recorded at least one price drop, underscoring the fact that sellers are adjusting to market conditions in order to stay competitive.

Cumulative new listings year-to-date reached 37,093, reflecting a 4.5% increase from last year and standing 23.4% above the long-term average. This surge in new supply has been a primary driver of the inventory expansion, pushing Months of Inventory higher and shifting leverage toward buyers in many submarkets.

Pending sales offer a more balanced picture. At 4,268 contracts, pendings are up 4.2% year-over-year, suggesting that buyer activity has not collapsed despite affordability pressures. However, cumulative pendings for the year total 30,178, still 4.2% lower than last year, reflecting a modest slowdown compared to the heavy listing flow.

The Activity Index, which measures the ratio of pending listings to active supply, fell to 19.8%, down from 21.4% in 2024. This decline highlights that while pendings are up modestly, the pace of absorption has slowed relative to supply.

Housing Prices

Prices remain well below their May 2022 peak, though the magnitude of correction varies by segment. The average sold price in August 2025 is $597,853, representing a 12.3% decline from the $681,939 peak, or roughly $84,000 less. The median sold price stands at $455,000, which is a 17.3% correction from the $550,000 peak, a decline of $95,000.

When compared against historical benchmarks, today’s market reflects both progress and challenges. The current median price is 8.3% below the level from 36 months ago, showing that the correction has not just erased short-term gains but rolled back multiple years of appreciation. Long-term, however, the market retains strength: over the past 25 years, Austin homes have appreciated at a compound annual rate of 5.027%. Based on this pace, if today represents the market bottom, prices would take 49 months, or until late 2029, to recover to the $551,155 peak value.

The divide between market segments is also becoming clearer. Over the past year, homes in the bottom quartile declined by 1.2% in price and 3.4% in price per square foot, while homes in the top quartile appreciated 6.8% in price, though still saw a 0.7% dip in price per square foot. This shows that the correction is uneven, with luxury properties holding more value than entry-level homes that remain constrained by affordability challenges.

Regional Trends

At the city level, performance varies widely. Eleven cities across the Austin metro recorded year-over-year price increases, while nineteen showed declines. Areas with faster-growing inventory levels, such as Leander, Liberty Hill, and Georgetown, are seeing more downward price pressure as supply outpaces demand. Conversely, markets with tighter constraints or stronger luxury activity, like Lakeway and certain Austin submarkets, are showing resilience.

Inventory trends at the city level illustrate the broader theme of imbalance. Austin’s Months of Inventory now stands at 5.32, up 8.7% year-over-year, while other surrounding areas show far steeper increases. Jarrell more than doubled its supply, and Liberty Hill, Cedar Park, and Round Rock all saw inventory rise by 30–60%. These shifts are forcing sellers to adjust pricing quickly to remain competitive, particularly in suburbs where new construction supply adds another layer of competition.

List-to-Sale Price Performance

With nearly 60% of listings posting a price drop, sellers who come to market aggressively are being pushed toward reality by buyer feedback. This is a clear indicator of a buyer-sensitive environment. The New Listing-to-Pending ratio for August stands at 0.71, in line with the year-to-date ratio of 0.70. Historically, the 25-year average ratio is 0.82, meaning today’s pace of absorption is weaker than long-term norms. The cumulative difference between new listings and pendings this year is 6,915, further confirming that excess supply is piling up faster than it is being absorbed. The Absorption Rate, measured as sold-to-active listings, sits at 12.1%, far below the historical average of 31.8%. This reading strongly favors buyers, indicating that listings are taking longer to move and that homes must be positioned strategically to capture demand.

Peak Value Trends

Despite the corrections of the past two years, Austin’s long-term story remains intact. Since January 2000, home values in the metro are still up nearly 70% on an inflation-adjusted basis. This means that while short-term affordability and absorption metrics are under strain, the long-run performance of Austin real estate continues to validate the city as one of the strongest housing markets in the nation. Looking ahead, the Market Flow Score (MFS) stands at 3.15, well below the historical average of 6.59. This signals that the market is supply-heavy, with sluggish turnover, and not yet poised for rapid recovery. For buyers, this environment offers negotiation power and a broader selection. For sellers, it underscores the need to price strategically and highlight unique property advantages.

Conclusion

The Austin housing market of August 26, 2025 is one defined by supply pressure and uneven pricing outcomes. Buyers benefit from elevated inventory and an increased likelihood of negotiating concessions, while sellers face a more competitive landscape where pricing discipline is essential. Investors must weigh today’s soft absorption and lower turnover against long-term appreciation trends, which remain firmly positive. Agents navigating this environment should lean into data-driven pricing strategies and clear client communication, as the market will continue to test assumptions heading into the fall.

Scroll down to view the full Austin Daily Real Estate Briefing PDF for August 26, 2025.​