The Austin housing market is no longer in freefall, but it is far from balanced, and today’s data shows a market that is still working through excess supply, cautious demand, and lingering price pressure.
Scroll down to view the full Austin Daily Real Estate Briefing PDF for January 22, 2026.
As of Thursday, January 22, 2026, Austin has 12,744 active residential listings. That is 12.0 percent higher than this time last year, even though inventory remains well below the prior peak of 18,146 listings reached in late June 2025. The pullback from that peak might appear encouraging at first glance, but the composition of today’s inventory tells a more important story. Over half of all active listings, 52.7 percent, have already experienced at least one price reduction. That is a clear signal that sellers are still adjusting expectations to match where buyers are actually willing and able to transact.
New construction continues to play a major role in the supply picture. Of the current active listings, 3,948 are new construction homes while 8,796 are resale properties. Builders have been more aggressive with incentives and pricing adjustments, which has helped support activity on the new construction side. Resale sellers, on the other hand, remain slower to adjust, and that gap is showing up clearly in both pricing behavior and absorption.
Pending listings provide another layer of insight into demand. There are currently 3,478 homes under contract, essentially flat year over year with a modest decline of 0.5 percent compared to January 2025. That stability might seem reassuring, but when placed alongside rising inventory, it points to a market where supply is still outpacing demand. Of those pending homes, 1,441 are new construction and 2,037 are resale, reinforcing the idea that builders are capturing a disproportionate share of today’s buyer activity.
One of the most telling metrics in today’s Austin market update is the Activity Index, which measures the percentage of active listings that go under contract in a given period. The overall Activity Index currently sits at 21.4 percent, down from 23.5 percent one year ago. This represents an 8.8 percent year over year decline in market activity. New construction is outperforming with an Activity Index of 26.74 percent, while resale lags significantly at 18.80 percent.
From a market phase perspective, this places much of the resale market squarely in the softening to contraction range. Activity levels between 20 and 25 percent typically indicate slowing sales and rising inventory, while readings below 20 percent suggest more serious supply imbalances and increased risk of price declines. A meaningful portion of Austin zip codes now fall into the contraction or even crisis categories, where buyer hesitation becomes the dominant force.
The imbalance between supply and demand becomes even clearer when looking at the new listing to pending ratio. The current monthly ratio is 0.62, meaning that for every new listing coming to market, fewer than two thirds are going under contract. Over the long term, Austin’s 25 year average for this metric is 0.82, which highlights just how subdued today’s demand really is. On a year to date basis, new listings exceed pending listings by 652 homes, reinforcing the idea that inventory is still building faster than it is being absorbed.
Months of inventory provides a familiar but important lens for understanding market leverage. Austin currently sits at 4.52 months of inventory, up 13.8 percent from 3.97 months one year ago. While this level does not yet represent extreme oversupply, the trend direction matters. Inventory is rising, not falling, and that shift continues to tilt negotiating power toward buyers. When isolating resale properties, many submarkets are already operating in buyer advantage or buyer control territory, where longer days on market and price concessions become the norm rather than the exception.
Sales activity itself remains mixed. A total of 1,783 homes have sold so far this year, which is down 5.2 percent year over year but still 16.9 percent above the long term average for this point in the calendar. This tells us that while sales volume is lower than last year, it has not collapsed. However, population adjusted metrics paint a less optimistic picture. Sales per 100,000 residents are down 7.3 percent year over year and sit 16.5 percent below historical norms. Sales per 1,000 Realtors are slightly higher year over year, up 2.0 percent, but remain 12.0 percent below average, reflecting continued competition among agents for a limited pool of active buyers.
Pricing trends continue to confirm that the market correction which began in mid 2022 is not yet fully resolved. The average sold price in January stands at $579,638, down roughly 15 percent from the May 2022 peak of $681,939. Median pricing shows an even deeper adjustment. The current median sold price is $430,000, representing a 21.82 percent decline from the peak median of $550,000. Even compared to prices from 36 months ago, the median is still down 4.43 percent, indicating that time alone has not been enough to restore pricing power.
Price behavior varies meaningfully across the market. Homes in the lower quartile have seen year over year price declines of 3.75 percent and price per square foot declines exceeding 5 percent. In contrast, the top quartile has managed modest appreciation, with prices up nearly 4 percent year over year. This growing divergence highlights a market where well located, higher quality homes continue to attract buyers, while more price sensitive segments face ongoing pressure.
Looking forward, long term appreciation math helps frame expectations. Austin’s 25 year compound annual appreciation rate is approximately 4.602 percent. If the market has indeed reached a cyclical bottom near the current median price of $430,000, it would take roughly 67 months, or until mid 2031, to return to prior peak pricing levels near $550,700 under normal appreciation conditions. That projection assumes stability and does not account for potential economic disruptions, interest rate volatility, or shifts in migration patterns.
Two additional indicators underscore the current state of market efficiency. The absorption rate, defined as sold listings divided by active listings, sits at just 7.50 percent, far below the historical average of 31.51 percent. This low reading confirms that inventory is moving slowly relative to supply. The Market Flow Score, which combines multiple turnover metrics into a single index, currently registers at 0.22 compared to a long term average of 6.57. In practical terms, this means the Austin housing market is operating with very low momentum, and price discovery remains a gradual and uneven process.
For buyers, today’s Austin housing market offers leverage that has not existed in several years. Higher inventory, widespread price reductions, and slower absorption create opportunities to negotiate price, repairs, and concessions, particularly in the resale segment. For sellers, success increasingly depends on realistic pricing from day one and a clear understanding of competing inventory. For investors and agents, the data reinforces the importance of hyper local analysis and disciplined underwriting, as broad market averages mask significant variation by price range and submarket.
The Austin real estate forecast remains one of gradual stabilization rather than rapid recovery. Supply is improving from extreme levels, but demand has not yet reaccelerated enough to restore balance. Until Activity Index readings move decisively higher and new listing to pending ratios normalize closer to historical averages, the market will continue to favor patience, precision, and data driven decision making.
