The Austin housing market continues to balance on a tightrope between elevated supply and cautious demand, creating a complex environment for buyers, sellers, and investors. With inventory levels climbing, price reductions spreading across the majority of listings, and buyer activity moderating compared to last year, this market update provides a clear picture of where things stand as we close out September 2025.

Scroll down to view the full Austin Daily Real Estate Briefing PDF for September 30, 2025.

Active residential listings today total 16,781, up 16.4% from the 14,415 homes available at this time in 2024. While still below the high of 18,146 reached in late June, inventory is heavy compared to historical averages. More telling, 59.1% of all active listings have had at least one price drop, showing that sellers are adjusting expectations in order to attract offers. For buyers, this environment increases negotiating power, while sellers face the challenge of pricing correctly in a competitive field.

Pending listings, however, highlight the demand side of the equation. There are currently 4,039 pending sales, nearly identical to the 4,099 recorded last year, but still representing a 1.5% year-over-year decline. Cumulatively, from January through September, 34,146 homes have gone pending, down 2.5% from last year but 5.7% above the long-term average. This pattern shows that while 2025 demand lags behind last year, it remains stronger than most historical norms.

The Activity Index, which measures the share of active listings that are under contract, stands at 19.4%, down from 22.1% in 2024. This 12.4% decline underscores the softer buyer pool relative to growing supply. Breaking down the numbers, new construction has a stronger Activity Index at 26.6%, while resale properties trail at 16.6%. Builders remain aggressive in offering incentives, which is giving newly built homes an edge over existing properties.

Looking at supply-demand balance, the New Listing to Pending ratio for September is 0.70, meaning that for every 10 homes listed, only 7 are going under contract. For the year, the ratio sits at 0.71, lower than the 25-year average of 0.82. This gap illustrates the current imbalance, where new supply consistently outpaces demand. As a result, inventory continues to accumulate.

The Months of Inventory (MOI) metric paints a similar picture. Current MOI is 5.94 months, up from 5.14 months in September 2024, marking a 15.7% increase. Historically, Austin’s long-term average has been closer to 4.5 months, meaning today’s conditions tilt toward a buyer’s market. Regionally, the year-to-date increase in Austin’s inventory is 25.3%, one of the sharpest jumps seen in recent years.

On the sales front, 2,315 homes closed in September, bringing the year-to-date total to 22,897. That figure is 4.2% lower than last year, though still 5.5% above the long-term average. Sales per 100,000 residents are down 6.5% year over year and sit more than 22% below the historical norm, suggesting slower turnover despite population growth.

Prices continue to reflect the long arc of correction. The average sold price in September is $554,855, down nearly $127,000 from the May 2022 peak of $681,939. That’s an 18.6% drop from peak values. The median price, now at $424,000, is down $126,000 from the peak of $550,000, a 22.9% decline. Compared to three years ago, median prices are down 9.8%. This context matters: while prices are lower than peak, they remain well above pre-pandemic levels, still reflecting years of strong appreciation.

For a longer-term view, consider Austin’s 25-year compound appreciation rate of 4.73%. If today’s median of $424,000 represents the market bottom, it would take about 71 months—roughly until July 2031—for prices to recover to $551,354, the projected peak-equivalent value at that appreciation rate. For both buyers and investors, this projection reinforces the idea that Austin’s long-term fundamentals remain strong, but recovery to past highs will be gradual.

Breaking down trends by market segment, the bottom 25% of homes saw prices fall 3.7% year over year, while the top 25% gained 4.2%. This suggests that higher-end homes are holding their value better, while affordability-driven segments remain under pressure. Across the metro area, 9 cities posted year-over-year median price gains, while 20 cities declined.

Absorption rates further emphasize market sluggishness. The current sold-to-active ratio is 14.3%, well below the historical average of 31.8%. Likewise, the Market Flow Score sits at 4.0, against a long-term average of 6.6. Both metrics reinforce the theme of slower turnover, extended marketing times, and heightened competition among sellers.

For buyers, today’s Austin housing forecast points toward opportunity. With nearly 60% of listings reducing price and inventory stretching to almost 6 months, leverage sits squarely with the buyer side. For sellers, strategy is everything: pricing realistically, offering incentives, and making homes move-in ready are critical to standing out. Investors should weigh current cap rates carefully against Treasury yields, but long-term fundamentals suggest that patient capital can find value in today’s market.

In summary, the September 30 Austin market update underscores a housing environment shaped by supply strength and tempered demand. Prices remain below peak, inventory is growing, and absorption rates remain soft, yet demand is still above historical averages, keeping the market from tipping into deep recession territory. The Austin real estate forecast continues to call for gradual adjustment rather than dramatic swings, with buyers holding a short-term advantage and long-term fundamentals supporting steady appreciation ahead.​