Austin Real Estate Market Update

Austin Real Estate Market Update – January 16, 2026

As of Friday, January 16, 2026, active residential listings in the Austin area stand at 12,764. While this is down significantly from the cycle high of 18,146 reached in late June 2025, it is still 12.6 percent higher than this time last year. This tells an important story. Inventory has come off its peak, but the market is carrying more supply than it did a year ago, and that supply is taking longer to absorb. For buyers, this means options remain plentiful. For sellers, it means competition is still very real.

Scroll down to view the full Austin Daily Real Estate Briefing PDF for January 16, 2026.

Price behavior confirms that competition. Today, 53 percent of all active listings have had at least one price reduction. That is more than half the market signaling that original list prices were not aligned with buyer demand. This is not isolated to one pocket or one price range. It is widespread across the region, which reinforces that pricing discipline is the defining factor for success in today’s Austin real estate market.

Breaking down inventory further, 3,930 of the active listings are new construction, while 8,834 are resale homes. Builders continue to carry a large share of total supply, but resale inventory remains the dominant force shaping day to day market dynamics. This matters because resale activity is often the clearest reflection of true consumer demand, free from incentives and builder pricing strategies.

Pending listings offer another layer of insight. There are currently 3,247 homes under contract, which is down 3.7 percent year over year. While active listings rose compared to last January, pending activity declined. That divergence tells us demand has softened relative to supply. Buyers are moving more cautiously, and fewer listings are converting into contracts at the same pace as last year.

This shift is clearly visible in the Activity Index, which measures the percentage of active listings that go under contract. The overall Activity Index sits at 20.3 percent, down from 22.9 percent one year ago. New construction continues to outperform resale with an Activity Index of 25.81 percent, while resale properties are at just 17.55 percent. In practical terms, resale homes are moving much more slowly, and many areas are now operating in contraction or crisis phases rather than balanced conditions.

When resale markets are segmented by phase, nearly half of resale areas fall into the contraction or danger zone, defined by Activity Index levels between 15 and 20 percent. Another 33 percent of areas are already in crisis or freeze conditions, where Activity Index readings fall below 15 percent. These are markets where buyer hesitation is pronounced, supply outweighs demand, and price corrections tend to accelerate.

Supply pressure also shows up in the new listing to pending ratio. The current monthly ratio is 0.53, which means that for every 100 new listings, only 53 are going under contract. This is well below the 25 year historical average of 0.82. Year to date, new listings exceed pending listings by 669 homes. That imbalance reinforces the reality that inventory is still building relative to demand, even though overall active counts have declined from their peak.

Months of inventory further confirms the trend. The Austin market now sits at 4.53 months of inventory, up 14.3 percent from the 3.96 months recorded one year ago. While this is not an extreme oversupply level, it clearly places the market outside of seller dominant conditions. Resale specific data shows a wide dispersion across cities and zip codes, with a growing share of areas falling into buyer advantage or buyer control categories.

Sales activity provides important context. There have been 1,750 homes sold in the Austin area so far this year. On the surface, cumulative sales are only down 6.9 percent year over year and remain above long term averages. However, when normalized for population, sales tell a different story. Cumulative sold per 100,000 residents is 66, which is down 8.9 percent year over year and 18 percent below historical norms. This indicates that population growth alone is not translating into proportional housing demand.

The same pattern appears when adjusting for agent count. Cumulative sales per 1,000 Realtors stands at 102, slightly higher than last year but nearly 13 percent below average. Competition among listings remains intense, and agents are closing fewer transactions per capita than in stronger market cycles.

Price trends continue to define the narrative of the Austin housing forecast. The average sold price in January is $584,059. That is down roughly $98,000, or 14.35 percent, from the May 2022 peak. Median pricing shows an even more pronounced adjustment. The median sold price is now $435,990, down $114,000, or 20.73 percent, from its 2022 high. Median prices are also running 3.10 percent below where they were 36 months ago, reinforcing that this is not just a seasonal pause but a multi year correction.

Price behavior differs by segment. The bottom 25 percent of the market has seen prices decline 3.13 percent year over year, with price per square foot down more than 5 percent. Meanwhile, the top 25 percent of the market has managed a 4.29 percent increase in prices, although price per square foot is still slightly lower. This divergence shows that higher end homes are holding value better, while affordability constraints continue to pressure entry level and mid range buyers.

Absorption metrics further explain market velocity. The sold to active ratio stands at 23.57 percent, well below the historical average of 31.61 percent. This confirms that inventory is taking longer to clear and that demand is not keeping pace with available supply. At the same time, the Market Flow Score sits at 8.57, above the long term average of 6.59. This suggests that while volume is lower, the transactions that do occur are moving through the system efficiently, often due to aggressive pricing, concessions, or incentives.

Looking forward, long term appreciation assumptions offer perspective rather than prediction. With a 25 year compound appreciation rate of 4.657 percent, a median price of $435,990 would require approximately 63 months to return to prior peak levels, placing a theoretical recovery around March 2031. This underscores a key point for buyers and investors evaluating the Austin housing forecast. Timing, cash flow, and risk tolerance matter far more than short term appreciation expectations in the current cycle.

For sellers, today’s Austin real estate market demands precision. Homes that are priced correctly and presented well are still selling, but the margin for error is thin. Overpricing almost guarantees price reductions and extended market time. For buyers, leverage remains meaningful, especially in resale segments and in areas operating within buyer advantage or buyer control conditions. For agents, the data reinforces the importance of pricing strategy, expectation management, and market education.

Austin real estate is not frozen, but it is no longer forgiving. The data shows a market that has reset from its highs and is now operating under a new set of rules defined by supply discipline, affordability constraints, and selective demand.

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FAQ SECTION

What is happening in the Austin housing market right now?

The Austin housing market is in a correction phase marked by higher inventory, slower absorption, and widespread price reductions. Active listings are up 12.6 percent year over year, while pending listings are down 3.7 percent, showing that supply is outpacing demand. Over half of all listings have already reduced their price, which signals that sellers are adjusting to buyer expectations. This is a market that rewards realistic pricing and patience rather than urgency.

Is Austin still a buyer’s market in 2026?

Many parts of the Austin area are operating in buyer advantage or buyer control conditions, especially in the resale segment. Months of inventory has risen to 4.53, and resale Activity Index levels show a large share of markets in contraction or crisis phases. Buyers generally have more choices, more negotiating power, and less competition than in recent years. However, well priced homes can still move quickly, so buyers should remain prepared.

Are home prices still falling in Austin?

Median home prices are down more than 20 percent from their 2022 peak, and prices are still running below levels seen three years ago. While not every segment is declining at the same rate, lower priced homes are under the most pressure. Higher end homes have been more resilient, though price per square foot is still soft. The overall trend remains one of stabilization after a significant correction.

What does the Activity Index say about demand?

The Activity Index measures how many active listings are going under contract, and today it sits at 20.3 percent overall. Resale homes are even lower at 17.55 percent, which places many areas in contraction or crisis phases. This indicates slower demand and increased buyer hesitation. New construction is performing better than resale, but still below levels seen during stronger cycles.

Is Austin real estate a good long term investment?

Long term data suggests Austin continues to benefit from population growth and economic diversity, but expectations must be realistic. Using historical appreciation rates, it could take more than five years to return to prior price peaks. Investors should focus on fundamentals like cash flow, location, and entry price rather than short term appreciation. The current market favors disciplined buyers who plan to hold long term.

Have a Question or Want to Dive Deeper?

If you’d like a custom breakdown of the data, want help interpreting today’s market trends, or just have a question about buying or selling in Austin, let us know. Fill out the form below and a member of our team will get back to you promptly.