Austin real estate is no longer falling fast, but today’s data confirms the market is still grinding through a slow, inventory-heavy reset rather than staging a recovery.
Scroll down to view the full Austin Daily Real Estate Briefing PDF for December 08, 2025.
The Austin real estate market enters the second week of December 2025 with clear signals that the correction phase is intact. Inventory remains elevated compared to last year, pricing pressure is widespread, and buyer activity has not meaningfully accelerated despite notable price declines from the 2022 peak. While the sharp volatility of earlier years has eased, the data shows a market that is stabilizing at lower activity levels rather than rebounding upward. This Austin market update matters because it highlights where demand is actually forming and where it is still missing.
Active residential listings currently sit at 14,426, down from the prior cyclical high of 18,146 reached in late June 2025. Even with that pullback, inventory remains 14.1% higher than this time last year, a reminder that supply is still elevated compared to recent norms. More telling is price behavior within this inventory. Today, 57.5% of all active listings across the MLS have experienced at least one price reduction. That level of price adjustment is not a short-term anomaly. It reflects persistent competition among sellers who are chasing limited buyer demand. In a market where more than half of listings are reducing prices, buyers know they have leverage and are willing to wait for the right opportunity.
New listings continue to flow into the market at an above-average pace. From January through November, Austin recorded 47,870 new listings, up 5.5% year over year and more than 23% above the long-term average. Sellers are still motivated to list, even though absorption has slowed. This creates a situation where inventory builds faster than it can be cleared, especially in resale segments where activity is weakest. Pending listings tell the other side of the story. Pending inventory is nearly flat year over year, down just 0.5%, signaling that buyer demand has not grown enough to keep up with increased supply.
The Activity Index, one of the clearest real-time demand metrics in Austin real estate, reinforces that imbalance. The index currently sits at 20.7%, down from 23.0% last year. On its own, that decline may appear modest, but context matters. Historically, Activity Index values above 25% are associated with balanced or seller-leaning conditions. At today’s levels, the market is firmly in a softening to contraction phase. This is especially pronounced in the resale market, where the Activity Index sits at just 17.51%, placing most areas in the Contraction or even Crisis range. New construction remains more active at 27.67%, largely driven by builder incentives rather than organic demand strength.
This divergence between new construction and resale is a critical point in the Austin housing forecast. Builders are effectively manufacturing demand through rate buydowns, price incentives, and flexible terms, while resale sellers are competing without those tools. For buyers, this creates uneven leverage depending on where they shop. For resale sellers, it means pricing must be sharper and expectations more realistic.
Monthly and annual listing-to-pending ratios further confirm the demand gap. The current monthly new listing to pending ratio is 0.93, meaning fewer homes are going under contract than are being listed. For the year, the ratio stands at 0.73, well below the 25-year average of 0.82. Over time, ratios below average signal accumulating inventory and slowing market velocity. Year to date, the difference between new listings and pending contracts totals 6,677 homes. That excess supply does not disappear quickly, and it continues to pressure pricing across most segments.
Months of Inventory offers another confirmation point. Austin now sits at 5.15 months of inventory, up 15.3% from last year. While this is not yet an extreme buyer-controlled market by historical standards, it is well above the levels seen during the 2020 to 2022 period. Within resale inventory specifically, a significant share of cities and zip codes fall into buyer advantage or buyer control categories. These conditions favor negotiation, concessions, and longer decision timelines for buyers.
Sales volume reflects this slower pace. November closed with 1,976 sold properties across the Austin area. Cumulatively, 27,706 homes have sold from January through November, down 4.0% year over year but still above the long-term average. This combination tells an important story. Transactions are still happening, but they are spread across a larger supply base, reducing turnover efficiency. Sold units per 100,000 residents remain 21.0% below average, and sold units per 1,000 Realtors are down 23.5% below average. The market is moving, but it is not moving efficiently.
Prices continue to reflect this reduced efficiency. The average sold price in November came in at $566,571, down $115,000 or 16.92% from the May 2022 peak of $681,939. The median sold price tells an even clearer affordability story. At $428,147, the median is down $122,000 or 22.16% from the $550,000 peak. This widespread decline confirms that pricing adjustments are not limited to a single segment. However, stability is starting to emerge. Compared to 36 months prior, the median price is down 6.92%, suggesting the market may be approaching a longer-term equilibrium rather than continuing an accelerated slide.
The distribution of price performance adds nuance. Over the past year, the bottom 25% of the market saw prices decline by 1.04%, while the top 25% actually experienced modest price growth of 0.97%. This split suggests that affordability-driven demand is supporting higher-end inventory better than expected, while entry-level and mid-range buyers remain constrained by rates and monthly payments. It also explains why some cities are showing year-over-year gains while the majority remain negative.
Absorption remains well below historical norms. The current absorption rate, also known as the sold-to-active ratio, sits at 15.36%, compared to a long-term average of 31.64%. This is one of the clearest indicators of weak demand relative to supply. In markets where absorption exceeds 30%, sellers typically retain pricing power. At today’s level, buyers control the pace of transactions.
The Market Flow Score ties these signals together. Today’s score of 5.36 compares unfavorably to the historical average of 6.58. This composite metric reflects slower turnover, weaker demand velocity, and reduced absorption efficiency. While the score does not indicate crisis conditions, it confirms that Austin real estate remains supply-heavy with limited momentum.
For buyers, this Austin market update highlights opportunity rather than urgency. Inventory is elevated, price reductions are common, and negotiation leverage exists across most resale markets. Patience is being rewarded, particularly for buyers focused on value rather than timing short-term price movements.
For sellers, the message is direct. The market is not rebounding yet. Homes that are priced aggressively are selling. Homes priced off peak expectations are not. Proper positioning, realistic pricing, and strong preparation are no longer optional.
For investors, the data suggests that yield discipline matters more than appreciation forecasts. With long-term compound appreciation around 4.772%, projections show that even from today’s median price, it could take until mid-2031 to fully recover prior peak levels under normal growth assumptions. This reinforces the need for conservative underwriting.
For agents, today’s Austin real estate forecast underscores the importance of data-driven guidance. This is not a market where intuition outperforms analytics. Understanding inventory, demand velocity, and pricing distribution is essential to advising clients effectively.
Austin housing is no longer in freefall, but it is also not in recovery. The data shows a market absorbing excess supply slowly, resetting expectations, and searching for a new balance point. Until demand meaningfully improves, pricing discipline and patience will define success across all sides of the transaction.
