Austin’s housing market is showing signs of rebalancing, with listings remaining elevated, activity cooling, and prices holding steady as the fall season progresses.
Scroll down to view the full Austin Daily Real Estate Briefing PDF for October 31, 2025.
Market Overview
As of October 31, 2025, the Austin-area housing market continues to recalibrate following two years of correction and inventory buildup. There are 16,323 active residential listings, up 17.3% from last year but down slightly from the June peak of 18,146. Nearly 60% of all listings have experienced at least one price reduction, confirming that sellers are adjusting expectations to match slower buyer absorption rates. This dynamic signals a market that has transitioned from the sharp declines of 2023 into a more gradual, data-driven rebalancing period.
Compared to October 2024, pending sales have edged down 2.6% to 3,865, while cumulative pending transactions for the year total 37,703, just 1.8% lower year-over-year. The small decline in pending activity, combined with rising listing counts, reflects a market operating at lower velocity — fewer buyers are writing offers, and more sellers are competing for attention.
The Activity Index, which measures the ratio of pending to total active listings, has fallen from 22.2% last year to 19.1% today, a 13.8% decline. Historically, Austin’s healthy range sits around 25% to 30%, meaning the market has drifted into the “softening” to “contraction” phase for resale homes.
Housing Prices
Home prices have largely stabilized following the major post-peak correction of 2022–2024. The average sold price in October stands at $589,290, marking a 13.6% decline from the May 2022 high of $681,939. The median sold price of $435,887 represents a 20.7% nominal decline from the same peak — roughly $114,000 less than the height of the market three years ago.
In real terms, after adjusting for inflation, Austin’s purchasing power has dropped roughly 28% from peak conditions, meaning today’s buyers are spending less in nominal dollars but not necessarily gaining affordability once inflation is considered. Still, the market shows encouraging signs: over the past 12 months, the median price has fallen just 7.3%, suggesting that the worst of the correction has likely passed.
If Austin resumes its 25-year historical appreciation rate of 4.85% annually, current prices imply it would take about 62 months (roughly five years) to return to the prior peak of $550,000 — a realistic and sustainable recovery timeline rather than the rapid run-ups of the pandemic years.
Regional Trends
The performance gap between high-end and entry-level properties continues to widen. Over the past year, homes in the top 25th percentile saw prices rise 6.2% and price per square foot up 2.9%, while the bottom 25th percentile declined 1.5% in price and 3.5% in $/sqft. This trend illustrates a market increasingly bifurcated by income and lending flexibility, where premium buyers remain active and lower-priced inventory faces longer absorption periods.
At the city level, 9 of 30 major cities in the Austin metro recorded year-over-year appreciation in median sold prices, while 21 declined. Outlying markets like Georgetown, Liberty Hill, and San Marcos remain oversupplied, while central Austin zip codes with constrained inventory are holding their ground.
Supply and Demand Dynamics
The Months of Inventory (MOI) — the key measure of balance between supply and demand — rose to 5.79 months, up from 4.97 months a year ago, a 16.6% increase. This shift means homes are taking longer to sell, and the leverage is tilting further toward buyers. For context, Austin’s long-term equilibrium point sits near 4.5 months, so current levels place the region firmly in a “buyer advantage” environment.
Within the city limits, Austin’s MOI is holding nearly flat year-over-year at 5.25 months (down 0.3%), indicating a more balanced local environment compared to suburban markets. Outlying cities such as Lockhart, Del Valle, and Hutto have seen inventory nearly double year-over-year, reflecting the slower pace of new-construction absorption.
By contrast, markets like Manchaca and Driftwood have seen significant reductions in inventory, suggesting local recovery where supply tightened faster than demand declined.
Activity Index and Market Flow
The Activity Index for resale homes at 16.5% underscores a slower, more competitive resale segment, while new construction holds firmer at 25.7% — evidence that builder incentives are effectively driving demand. The gap between new and resale absorption is now the widest in nearly two years.
The Market Flow Score (MFS) — a composite of absorption, velocity, and turnover — currently reads 3.53, compared to a historical average of 6.58. This below-average figure confirms a sluggish market flow, consistent with the high inventory and moderate buyer traffic patterns seen through the fall.
The Absorption Rate, which measures the percentage of active listings that sell within a given period, sits at 14.1%, less than half the long-term average of 31.7%. This suggests it would take most of Q4 for existing inventory to clear at current contract pace, barring a sharp improvement in buyer activity.
Long-Term Trends and Recovery Outlook
Despite today’s slower conditions, the long-term trajectory of Austin real estate remains healthy. The 25-year compounded appreciation rate of 4.85% highlights the city’s resilience through multiple cycles. Even in periods of correction, Austin consistently outperforms most major U.S. metros over a 10-year horizon.
Looking ahead, several indicators suggest we’re in the late stages of correction rather than mid-cycle decline. Inventory is 10% below its summer peak, price declines have narrowed to single digits year-over-year, and cumulative pending sales are only 2% lower than 2024 despite a larger supply base.
For buyers, this environment offers leverage unseen since 2011 — the ability to negotiate, shop patiently, and capture long-term value. For sellers, pricing alignment remains crucial; homes positioned correctly against competition continue to sell, while those overpricing sit stagnant.
Agents and investors should monitor the New Listing to Pending Ratio, currently 0.70, below the 25-year average of 0.82. This means that for every 10 new listings entering the market, only about 7 are going under contract — a clear indicator of absorption lag. The cumulative gap between new and pending listings now totals 7,352 units, contributing to the sustained inventory surplus.
Conclusion
In summary, Austin’s housing market is operating in a measured, data-driven slowdown — not a collapse. Activity is cooling but stable, inventory remains high but trending slightly downward, and pricing shows the first signs of normalization after a multiyear correction. The months ahead are likely to see a continuation of this rebalancing trend, with sellers adapting to longer market times and buyers regaining choice and negotiating power.
