As of February 04, 2026, active residential listings across the Austin area sit at 12,760. While this is well below the prior inventory peak of 18,146 reached in late June 2025, it still represents an 11.1% increase compared to the same time last year. This tells an important story. Inventory pressure has eased from its worst point, but the market remains meaningfully more supplied than it was a year ago, keeping leverage tilted toward buyers and limiting sellers’ pricing power.
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One of the clearest signals of this imbalance is price behavior. Just over half of all active listings, 50.1%, have experienced at least one price reduction. That is not a seasonal anomaly or a short term reaction. It reflects ongoing resistance from buyers at current price levels. Sellers are adjusting, but often slowly, and usually only after initial listing prices fail to generate activity. Markets with healthy demand rarely see half of listings cutting price at the same time.
Breaking inventory down further helps explain why absorption remains uneven. Of the 12,760 active listings, 3,998 are new construction while 8,762 are resale homes. New construction continues to post stronger engagement metrics, which is reflected later in the Activity Index, but resale inventory remains the heavier drag on overall market performance. This distinction matters for both buyers and sellers, especially when comparing pricing expectations and negotiation leverage.
New listing activity adds another layer to the story. Cumulative new listings from January through early February total 3,633, which is down 5.1% year over year but still 19.4% above the long term average. Fewer homeowners are choosing to list compared to last year, yet the absolute number of listings remains elevated compared to historical norms. This combination suggests seller hesitation rather than true supply scarcity. Many potential sellers are staying on the sidelines, but there are still more homes available than the market can comfortably absorb at current demand levels.
Pending listings offer insight into the demand side of the equation. As of today, pending listings total 3,614, which is only 0.9% higher than this time last year. Cumulative pending activity from January through early February stands at 2,986, down 4.4% year over year but slightly above the historical average by 2.2%. Demand has not collapsed, but it is clearly restrained. Buyers are active, but selective, and price sensitivity remains high.
This dynamic becomes clearer when looking at the Activity Index. The overall Activity Index is currently 22.1%, down from 23.8% last year, representing a 7.2% decline. On the resale side specifically, activity sits at 19.89%, placing much of the resale market firmly in the contraction or danger zone phase. This phase is defined by slower sales, rising inventory, and downward pressure on prices. New construction, by contrast, is posting an Activity Index of 26.47%, which is closer to equilibrium and explains why builders continue to outperform resellers in both absorption and pricing stability.
The relationship between new listings and pending contracts reinforces this point. The monthly new listing to pending ratio is currently 0.70, well below the 25 year average of 0.82. On a year to date basis, there are 647 more new listings than pending contracts. When this ratio stays below historical norms for an extended period, it signals that supply is arriving faster than demand can absorb it, even if inventory levels appear to be stabilizing.
Months of inventory confirms the buyer friendly nature of the market. Austin now sits at 4.54 months of inventory, up 13.4% from 4.00 months last year. While this level is not extreme by historical standards, it clearly places the market outside of seller dominated conditions. On the resale side, many cities and zip codes are firmly in buyer advantage or buyer control territory, where excess supply leads to longer days on market and increased negotiation leverage for buyers.
Sales activity provides further context. Total sold properties year to date stand at 1,587, down 15.6% from last year but still 4.6% above the long term average. This tells us that while transactions have slowed compared to 2025, the market is still functioning at a level that exceeds historical norms. However, when adjusted for population growth and agent count, sales efficiency weakens considerably. Cumulative sold properties per 100,000 residents are down 17.4% year over year and 25.4% below average. Sold properties per 1,000 Realtors are down 9.7% year over year and 21.7% below average. Competition among agents remains intense, and transaction volume is not keeping pace with industry headcount.
Pricing trends remain the most visible outcome of these supply and demand dynamics. The average sold price in January came in at $540,554, down from the May 2022 peak of $681,939. That represents a 20.73% decline, or roughly $141,000. Median pricing paints an even starker picture. The current median sold price is $404,000, down 26.55% from the May 2022 peak of $550,000, a decline of approximately $146,000. Median prices are now 10.21% below where they were 36 months ago, reinforcing the idea that this correction has extended beyond a short term cycle.
Price performance also varies significantly across price tiers. Over the past year, the bottom 25th percentile of homes saw prices decline by 5.08% and price per square foot fall by 5.83%. In contrast, the top 25th percentile experienced price growth of 2.33% and price per square foot growth of 2.27%. This split highlights a growing bifurcation in the Austin market. Higher quality, well located, or premium homes are holding value better, while entry level and marginal inventory continues to face pressure.
At the city level, only six cities posted year over year median price gains, while 23 saw prices decline. When evaluated through the Home Value Index, 80% of cities are currently classified as overvalued, 20% as fairly valued, and only one city as undervalued. This reinforces the idea that pricing normalization is still underway across much of the metro.
Market efficiency metrics tie these trends together. The absorption rate, defined as sold listings divided by active listings, currently stands at 14.43%, far below the historical average of 31.54%. This indicates a slow moving market where inventory turnover is constrained. The Market Flow Score, which aggregates multiple turnover and demand metrics, is currently 2.89 compared to a historical average of 6.58. Lower scores reflect a supply heavy market with limited momentum, which aligns with what pricing, inventory, and activity data are already showing.
Looking forward, long term projections offer perspective but not immediate relief. Assuming the market has already reached its correction low at a median price of $404,000 and resumes its 25 year average appreciation rate of 4.351%, it would take approximately 89 months, or until May 2033, for the median price to return to its prior peak. This projection underscores the difference between market recovery and market normalization. Prices do not need to return to peak levels for the market to function well, but expectations should be grounded in realistic timelines rather than rapid rebounds.
For buyers, today’s Austin housing market offers leverage, selection, and negotiating power that did not exist during the peak years. For sellers, success requires accurate pricing, strong presentation, and an understanding that the market is no longer forgiving of overreach. Investors should focus on cash flow, long term fundamentals, and price discipline rather than appreciation driven strategies. For agents, this environment rewards data literacy, market knowledge, and proactive guidance more than optimism alone.
Austin real estate is transitioning from correction to stabilization, but that transition is uneven and highly segmented. Inventory has retreated from its peak, but demand has not accelerated enough to support broad based price growth. Until those conditions change, the market will continue to favor informed buyers and disciplined sellers.
