Austin enters December with rising inventory, softer demand, and prices that continue to settle into a long correction rather than a temporary dip.
Scroll down to view the full Austin Daily Real Estate Briefing PDF for December 04, 2025.
The Austin real estate market on December 04, 2025 continues to move through a slow correction cycle shaped by elevated supply and demand that has not yet returned to historical strength. Active inventory is high, price reductions remain common, and buyers have more leverage today than at any time since before the pandemic boom. These conditions set the tone for the Austin housing forecast as the year comes to a close.
Active listings today total 14,474 homes, which is 14.3% higher than this time last year. This level of supply places Austin firmly in a buyer favorable environment. Although inventory is down from the June 2025 peak of 18,146 homes, the market remains far above balanced conditions. One of the clearest signs of continued oversupply is the percentage of listings that have taken a price drop. Today, 57.8% of all active listings have reduced their price at least once, showing that sellers are adjusting to slower demand and increased competition in almost every price range.
Pending activity reflects the same pattern. There are 3,776 homes under contract today, compared to 3,768 one year ago. This 0.2% difference shows demand has remained flat rather than improving. Flat demand in a rising supply environment always shifts the balance toward buyers. The Activity Index captures this dynamic clearly. The index sits at 20.7% today, down from 22.9% last year. A decline of 9.7% places Austin in the softening to contraction phases, where listings accumulate faster than they are absorbed. The resale Activity Index is even lower at 17.84%, while new construction performs better at 27.01% due to incentives and rate buy downs that builders are using to drive traffic.
New listing behavior is one of the biggest contributors to the current imbalance. From January through November, the market recorded 47,870 new listings. That is 5.5% above last year and 23.2% above the long term average. At the same time, cumulative pending sales for the year total 41,135, which is 0.8% below last year but still 7.5% above average. This combination created a cumulative New Listing to Pending gap of 6,735 homes. When new listings outpace pendings by this margin, supply builds and turnover slows, which is exactly what Austin has experienced throughout 2025.
The New Listing to Pending Ratio for the year stands at 0.73, well below the 25 year average of 0.82. A lower ratio reflects weaker market momentum and reduced demand relative to supply. The monthly ratio is currently 0.91, which is better than several earlier months but still not enough to signal a balanced market. Historically, Austin performs best when each new listing is matched with an equal or greater number of pending contracts. That is not the case today, and it has contributed directly to ongoing inventory pressure.
Months of Inventory provides another clear picture of the market’s direction. Today, the metric sits at 5.15 months, compared to 4.47 months at this time last year. A 15.3% year over year increase confirms that the market continues to shift toward buyers. Austin typically requires inventory below three months to generate consistent upward pressure on prices. With supply above five months, buyers gain negotiating power, take more time to make decisions, and hold firm on price expectations.
Pricing data shows the effects of this prolonged supply imbalance. The average sold price for November is $566,216. Compared to the May 2022 peak of $681,939, the average price is down 16.97% or about $116,000. The median sold price, now at $428,000, has fallen 22.18% or around $122,000 from the peak of $550,000. These declines confirm that Austin remains in a multi year correction rather than a brief adjustment. Price movement is steady and predictable given today’s elevated inventory and moderate demand.
When comparing the current median price to the median price 36 months ago, the market is down 6.96%. Austin’s long term appreciation rate of 4.770% helps forecast how long it may take to return to peak values. If the market grows at its historical rate moving forward, today’s median of $428,000 would require about 68 months to reach the projected peak value of $550,105. That timeline places recovery around June 2031. While no forecast can account for every economic change, this projection aligns with current conditions and highlights the challenge of regaining peak pricing without strong demand or tighter supply.
Sales volume also illustrates the slowdown. From January through November, Austin recorded 27,686 closed sales. That is 4.0% below last year but still 7.0% above the long term average. When adjusted for population, the market produced 1,081 sales per 100,000 residents, which is 6.3% below last year and 21.1% below the historical average. When adjusted for agent count, the market produced 1,496 sales per 1,000 Realtors, which is 0.5% above last year but 23.6% below average. These adjustments show that turnover remains lower than expected even after accounting for population and agent growth.
Absorption and efficiency metrics reinforce this picture. The absorption rate, measured as the percentage of active listings that sell within a given period, is 15.34% today. The long term average is 31.64%. This massive gap demonstrates how slowly listings are converting into contracts. The Market Flow Score is 5.32, compared to the historical average of 6.58. This score blends multiple turnover metrics to show how efficiently the market is operating. A reading in the low fives signals weak demand, longer selling timelines, and continued price pressure.
City level and price tier data show a mixed landscape. Austin as a city has seen Months of Inventory rise 13.7% year over year and 5.9% year to date. The top 25th percentile of homes has experienced slight price gains, while the bottom 25th percentile continues to show price declines. This split is common in correction cycles. Buyers in higher price tiers tend to be less affected by interest rate changes, while entry level buyers face affordability barriers that slow absorption.
Overall, the Austin real estate market remains supply heavy, demand light, and price sensitive. Homes that are priced correctly and presented well still sell, but the days of automatic, fast moving appreciation are behind us for now. Until affordability improves or inventory tightens meaningfully, the Austin housing forecast points toward continued moderation. Buyers benefit from more choices, more time, and more negotiating leverage. Sellers must focus on competitive pricing and strong presentation to stand out in a slower moving market.
