July 21, 2025 - Monday Touch Point
Inventory Climbs, Buyer Activity Slows
The Austin real estate market just crossed another critical milestone. As of July 21, 2025, active listings reached 18,001—just shy of a new all-time high—while buyer activity continues to trail. This week’s Monday Touch Point reveals a market defined by rising inventory, sharp pricing adjustments, and a continued drop in pending contracts. With the new listing-to-pending ratio falling to 0.54, the imbalance between supply and demand is widening. For buyers, this means more choices and leverage. For sellers, it means sharper pricing and urgency. This session delivers a comprehensive look at inventory trends, absorption rates, median price movements, and bond market momentum—arming you with the most accurate and timely data in Austin real estate today.
Inventory Pressure Mounts as Austin Market Faces Historical High
The Austin real estate market continues its summer trajectory with a significant build-up in inventory, slower buyer activity, and clear signs of price softening. As of July 21, 2025, the six-county MLS inventory stands at 18,001 listings—just 75 shy of breaking last month’s record of 18,076. That’s nearly a 780% increase from April 2022 when inventory hit rock bottom. The leading market indicator—new listing to pending ratio—is currently tracking at 0.54, down from 0.56 last week and well below last year’s 0.84 at this time. This means that for every 100 new listings, only about 54 are going under contract. It's a clear sign that inventory continues to outpace demand, putting additional pressure on sellers to reduce prices or withdraw their listings altogether.
Year-over-Year and Month-to-Date Comparisons
Listings have seen a 7.4% year-over-year increase, and we’re on pace to exceed last July’s listing count if current trends hold. However, pendings are lagging, sitting 42.6% below last year month-to-date, and sold transactions are down 55.2%. If the trend continues, July is on track to close 20% fewer homes than July 2024. Withdrawn listings have also surged, with 779 withdrawals so far this month. Year-over-year, the six-county region has recorded 16,416 expired or withdrawn listings, a strong indicator that many sellers are unable to meet the market where it is.
Price Reductions Dominate the Landscape
This week, 95% of price changes were reductions, consistent with recent weeks. Georgetown leads in price drops, with over 63% of its active listings showing a decrease. In total, 92% of price changes this month have been reductions, underscoring the price sensitivity of today’s buyers and the need for sharp pricing strategies. Buyers are acting more selectively—often backing out of one contract when a better-priced or better-located home comes to market. Back-on-market percentages are at 22%, the highest since December 2024, indicating buyers are more hesitant and opportunistic.
Pricing Outlook: Median Faces Negative Turn
The median sold price currently sits at $445,500, up only $510 month-over-month and $500 year-over-year. With the last 10 days typically favoring lower-priced transactions, the month-over-month figure is expected to turn negative. This would mark the third consecutive year of median price declines—something that hasn't occurred in Austin since the late 1980s. The average sold price, at $598,336, remains up 1% year-to-date but is still 13.3% below the May 2022 peak. On the median side, we are down a full $105,000 from peak pricing, a 19% drop.
Activity Index: Slipping Below Neutral
The market activity index sits at 19.5%, nearing the cooler side of the market spectrum. New construction continues to outperform resale. In Kyle, for instance, the activity index is 41.7% for new homes, compared to 18.2% for resale—a striking difference, further visualized by our red dot indicators on the city graphs. Currently, 57.8% of active listings have dropped price, and cities like Austin (6.28 months inventory) are on the brink of officially being buyer’s markets. A few cities, including Cedar Creek and Burnet, are already over 11 months of inventory.
Forecasts and Final Thoughts
Pending sales are expected to finish the month around 3,000–3,100, which would put us 20% below July 2024. Closed sales should reach ~2,700. If current market dynamics continue, the city is set to experience a third year of declining median prices, historically rare. Looking ahead, this week will be critical. Upcoming bond market movements and new home sales data could shift the trajectory. Inventory momentum remains strong, and unless pendings rise, sellers will need to recalibrate quickly.
FAQs
1. Why is Austin's real estate inventory still rising in July 2025?
Inventory continues to rise due to a weak absorption rate—only 54% of new listings are going under contract. With more sellers entering the market than buyers making purchases, inventory has hit 18,001 listings, nearing an all-time high.
2. How is Austin’s market different from last July?
Compared to July 2024, pending sales are down 42.6%, while active inventory is up 15.7%. The new listing to pending ratio is significantly weaker at 0.54 versus 0.84 last year.
3. Are prices still falling in Austin?
Yes. The median sold price is expected to turn negative month-over-month. We’ve already seen a $105,000 drop from peak pricing in 2022. This would mark the third consecutive year of median price declines.
4. Which parts of Austin are seeing the most activity?
Kyle and Buda lead with the highest activity index. Kyle has an index of 31%, and new construction in Kyle is even stronger at 41.7%. Resale activity is notably weaker in most markets.
5. What’s the market outlook for the rest of 2025?
Inventory is expected to remain elevated unless demand increases. With bond market improvements, we may see rates fall slightly, which could help, but pricing and pending transactions will likely remain soft through the remainder of Q3.
