Should You Sell Your Austin Home Now or Wait Until 2026?

Is Now the Right Time to Sell in Austin? A Data-Driven Look at the 2025 Market

The Austin housing market is navigating a period of significant correction, and for homeowners considering whether to sell now or wait until 2026, understanding the data is critical. With historic shifts underway in pricing, inventory, and buyer behavior, the answer is more complex than a simple yes or no. This analysis unpacks current conditions to help sellers make an informed decision.

One of the clearest signals of today’s market correction is the decline in the Sold to List Price Ratio, which has fallen to 97.2% as of July 2025. This is the lowest reading for the month of July since 2011, when it reached 96.8%, a time marked by the aftermath of the 2008 housing downturn. To put this in perspective, just four years ago during the height of the pandemic-fueled market, this same ratio peaked at 106.6%, meaning homes were routinely selling for well above their asking price. The current figure reflects a substantial shift, with sellers now conceding more during negotiations to secure a sale.

Further evidence of the market’s softening comes from the volume of price reductions. As of July 7, 56.9% of all active residential listings across the Austin area have experienced at least one price drop. In certain communities, such as Georgetown, Pflugerville, and Round Rock, price reductions exceed 61%, highlighting the widespread nature of this trend. These figures suggest that pricing optimism from sellers is consistently being met with market resistance.

Inventory levels have also reached historic highs. Active residential listings currently sit at 17,747, which is slightly down from the all-time high of 18,076 recorded just ten days earlier on June 27, 2025. Compared to pre-pandemic averages, today's inventory levels are not only elevated but remain well above the peaks seen in 2024, when listings topped out at 15,503 in mid-July. With so many homes on the market, competition among sellers is fierce, creating downward pressure on prices and extending the time required to sell.

The New Listing to Pending Ratio offers another key insight. At 0.45, this ratio represents the lowest level for the month of July in over two decades. Historically, a healthy market maintains a ratio near 0.80, indicating a near balance between new listings and homes going under contract. Today’s ratio reveals that for every two new listings, fewer than one is going under contract, resulting in rising inventory and prolonged market times.

Months of Inventory (MOI), a measure of how long it would take to sell all homes on the market at the current pace of sales, currently stands at 6.32 for the Austin area. By traditional real estate standards, this reflects a clear buyer’s market. The long-term average for Austin tends to hover closer to four months, while an MOI above six signals that supply is significantly outpacing demand. In specific submarkets, the situation is even more pronounced. Marble Falls has soared to 11.0 months, while areas like Smithville, Dale, and Spicewood also report MOI exceeding 10 months, making them especially challenging for sellers.

Buyer demand, as reflected by the Activity Index, has also weakened notably. The index is currently at 19.5%, down from 23.1% a year ago and well below the levels seen during the market's peak. This contraction in buyer activity means fewer showings, longer days on market, and an increased likelihood of price negotiations.

From a pricing perspective, both median and average home prices have retreated from their highs. The average sold price in Austin is down 16.4% from the 2022 peak, while the median price has declined by 15.3%. Historically, price recoveries following similar downturns have taken several years. Data from previous cycles, including the post-2008 correction, suggests that price stabilization often lags initial market shifts by 18 to 36 months.

When combining these data points—the lowest Sold to List Price Ratio for July in 14 years, record-high inventory, softening prices, and declining buyer demand—the market presents clear challenges for sellers today. While some homeowners may still secure acceptable offers, it often requires price reductions, incentives, or extended market times. Sellers unwilling to make these adjustments face heightened risk of their property sitting on the market unsold.

Looking ahead to 2026, several factors suggest conditions could begin to normalize, though recovery is unlikely to be immediate or dramatic. If inventory levels stabilize, buyer demand strengthens, and interest rates moderate, the Austin market could gradually shift toward balance. However, given current trajectory, any substantial price appreciation or return to bidding wars appears unlikely in the short term.

For homeowners contemplating a sale, the decision ultimately depends on individual circumstances. Those with flexibility, who are not under financial pressure and can afford to wait, may find it advantageous to monitor the market into 2026, when conditions could be more favorable. Conversely, sellers who need to move, liquidate assets, or who are prepared to price aggressively to attract today's buyers can still achieve a sale—but should do so with realistic expectations grounded in market data.

The bottom line is that the Austin real estate market in mid-2025 remains in a correction phase. While it is still possible to sell a home, doing so requires a strategic approach, pricing that reflects current realities, and patience. For those with the ability to wait, keeping an eye on inventory levels, buyer demand, and price trends into 2026 may provide a better opportunity to sell under improved conditions.

FAQ

Is the Austin real estate market still declining in 2025?

Yes, key market indicators show the Austin housing market is still in a correction phase. Sold to List Price Ratios have dropped to 97.2%, inventory levels remain elevated at over 17,700 active listings, and the New Listing to Pending Ratio has fallen to 0.45, reflecting weak buyer demand.

How much have home prices dropped in Austin?

As of July 2025, the average sold price in Austin is down approximately 16.4% from the peak levels reached in 2022. The median price has declined by around 15.3%, based on current market data.

What is Months of Inventory, and why does it matter?

Months of Inventory measures how long it would take to sell all homes on the market at the current pace of sales. At 6.32 months, Austin is firmly in a buyer's market. This indicates excess supply, reduced buyer competition, and greater negotiating power for buyers.

Is 2026 expected to be a better time to sell?

While future market conditions are never guaranteed, historical trends suggest that after significant corrections, markets often take 18 to 36 months to stabilize. If inventory levels decline, buyer activity improves, and economic conditions support housing, 2026 could present a more favorable selling environment.

Can I still sell my home now if I need to?

Yes, homes are still selling, but sellers must price competitively and be prepared for negotiations. Over 56% of current listings have had at least one price drop. Success in today's market depends on accurate pricing, strong presentation, and realistic expectations.​