Active residential listings across the Austin-area MLS stand at 13,035, which is up 11.6 percent year over year compared to this time in 2025. While this level of inventory is well below the prior cycle high of 18,146 reached in June 2025, it still represents a materially higher supply backdrop than what the market operated under for most of the last decade. Nearly half of all active listings, 49.2 percent, have already experienced at least one price reduction, reinforcing that sellers are being forced to respond to slower buyer absorption.
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The composition of active inventory also matters. Of the 13,035 active listings, 4,034 are new construction while 9,001 are resale properties. Builders continue to account for a meaningful share of supply, but resale inventory remains the dominant driver of market conditions. This is important because resale homes tend to be more price sensitive and are often owned by sellers with varying levels of urgency. As a result, resale pricing pressure is more reflective of true market demand than new construction, where incentives and rate buydowns can mask underlying softness.
New listing activity remains notably weak. From January through early February, cumulative new listings total 4,864, which is down 37.8 percent year over year and nearly 20 percent below the long-term average. This tells us that sellers are not flooding the market despite higher inventory levels. Instead, many homeowners appear reluctant to list unless they have a strong reason to move. This dynamic is helping prevent inventory from accelerating further, but it is not enough to offset reduced buyer demand.
On the demand side, pending listings provide a clearer signal of buyer behavior. Pending listings currently stand at 3,803, up a modest 2.2 percent year over year. While that increase may appear positive at first glance, context matters. Cumulative pending contracts from January through February total just 3,953, which is down 40 percent year over year and more than 33 percent below the historical average. This gap between active listings and pending contracts highlights the core issue in the Austin housing market today. Supply exists, but buyers are moving slowly and selectively.
The Activity Index, which measures pending contracts as a percentage of total inventory, reinforces this conclusion. The overall Activity Index sits at 22.6 percent, down from 24.2 percent last year. New construction shows a stronger Activity Index at 27.33 percent, while resale activity lags at just 20.25 percent. In market phase terms, most resale markets fall within the softening or contraction ranges, where sales slow, inventory builds, and price pressure increases. Very few areas are experiencing expansion-level demand, and a meaningful share of the market remains in contraction or near-freeze conditions.
One of the clearest indicators of market imbalance is the new listing to pending ratio. On a monthly basis, this ratio is currently 0.59, meaning significantly more listings are entering the market than are going under contract. For the year to date, the ratio stands at 0.69, well below the 25-year historical average of 0.82. Over time, ratios below the historical norm indicate excess supply relative to demand. This pattern is consistent with a market where sellers must compete more aggressively on price, terms, and condition to attract buyers.
Months of inventory further confirms the shift in leverage. Austin-area months of inventory currently measure 4.63, up nearly 14 percent from 4.06 a year ago. While this level does not yet signal extreme oversupply, it firmly places the market in a buyer-leaning environment. When isolating resale inventory, many cities and zip codes fall into buyer advantage or buyer control categories, where excess supply leads to longer days on market and downward pressure on prices. Importantly, even markets that appear balanced on the surface are often only stable because pricing has already adjusted.
Sales activity provides another layer of insight. In February, 1,953 residential properties closed, and cumulative sales from January through February total 3,593. While this is down 7.3 percent year over year, it is actually 8.2 percent above the long-term average for this time of year. This suggests that transactions are still occurring, but at price levels that buyers are willing to accept. Sales per 100,000 residents, however, remain down more than 22 percent versus average, indicating that population growth is not translating into proportional housing demand.
Pricing trends remain under pressure, especially when viewed against prior cycle peaks. The average sold price in February is $562,664, down roughly 17.5 percent, or about $119,000, from the May 2022 peak. The median sold price stands at $430,000, representing a 21.8 percent decline from the $550,000 peak reached in 2022. Median pricing is particularly important because it reflects the center of the market rather than higher-end transactions. Even more telling, the median price is now slightly below where it stood 36 months ago, confirming that nominal prices have fully retraced recent gains in many segments.
Price performance varies by price tier. Over the past year, the bottom 25 percent of the market saw prices decline by 5.68 percent, while the top 25 percent posted a modest 1.72 percent increase. This divergence shows that higher-end homes are holding value better, while affordability constraints continue to weigh on entry-level and mid-range buyers. This split is consistent with a market where income growth has not kept pace with prior price appreciation.
Looking ahead, long-term projections help frame expectations. Using Austin’s 25-year compound appreciation rate of 4.602 percent, and assuming the current median price of $430,000 represents a cyclical bottom, it would take approximately 67 months for the market to return to its prior peak near $550,000. That timeline points to mid-2031 as a reasonable recovery window, assuming normal economic conditions and steady demand growth. This is not a forecast of rapid appreciation, but rather a reminder that recovery in housing markets tends to be measured, not immediate.
Additional demand indicators support a cautious outlook. The absorption rate, defined as sold listings divided by active listings, currently stands at 14.76 percent, far below the historical average of 31.54 percent. This low absorption rate signals a slow-moving market where inventory turnover is limited. Similarly, the Market Flow Score, which combines multiple turnover and efficiency metrics, sits at 3.09 compared to a historical average of 6.58. Scores at this level reflect a sluggish, supply-heavy environment rather than a market poised for acceleration.
For buyers, the current Austin housing market offers leverage that has been absent for years. Elevated inventory, widespread price reductions, and slower sales velocity create opportunities to negotiate on price, concessions, and timing. Buyers who remain patient and disciplined are more likely to secure favorable terms, particularly in resale segments where sellers may be more motivated.
For sellers, realism is essential. Homes that are priced based on past peaks or emotional expectations are likely to sit. The data clearly shows that buyers are responding to value, not aspiration. Sellers who align pricing with current demand, prepare their homes properly, and remain flexible on terms are still completing transactions, even in this slower environment.
For investors and real estate agents, the market demands a data-first approach. Volume is lower, competition is higher, and efficiency matters more than ever. Understanding local supply dynamics, price sensitivity by segment, and realistic absorption timelines is critical for navigating the current cycle. The Austin real estate market is no longer forgiving of guesswork.
In summary, today’s Austin market update reflects a housing market that has stabilized from last year’s peak inventory levels but remains constrained by weak demand and affordability pressures. Inventory is elevated, price discovery is ongoing, and recovery will require time rather than speculation. The data points consistently toward a market that rewards preparation, patience, and clear-eyed analysis.
