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Thinking about buying property in Austin? 2025 might be your perfect window of opportunity.
With housing prices dipping and a favorable buyer’s market emerging, now is the time to act.
Read this article to find out why Austin is a great choice this year—and if you’re considering investing, check out our custom Austin property investment spreadsheet to assess profitability and make smarter decisions.
This article gives you valuable insights, but remember, it’s not and will never be investment advice. We pull data from a range of sources to provide you with the most accurate picture possible, yet we can’t guarantee complete accuracy. Markets are difficult to predict. Make sure to do your own research and consult a professional before making any financial moves. Any risks or losses are your own responsibility.
1) Austin's median home price actualy dropped 3% to $430,000
The median home sale price in Austin decreased by 3% year-over-year in October 2024, reaching $430,000, indicating a softening housing market.
This trend suggests cooling demand or increased supply.
Factors such as higher interest rates, more housing developments, and economic uncertainties contribute to this decline.
Sellers may need to lower prices to attract buyers, perpetuating the trend.
Given these conditions, Austin's housing prices are expected to continue declining into 2025, with no signs of reversal, as buyers anticipate further price drops.
Source: Austin Business Journal
- Why is 2025 the perfect year to buy property in Austin?
2) Austin home values are actually forecasted to drop 2.7%, signaling a cooling market after years of rapid growth
Zillow forecasts a 2.7% decrease in Austin home values from July 2024 to July 2025, reflecting a broader trend of softening prices.
This decline is part of a market adjustment after years of rapid growth, influenced by increased housing supply and changing economic conditions.
Austin, once a hot real estate market, is seeing prices level off as demand slows and more homes become available.
This stabilization suggests a shift from the era of rapidly rising prices.
Sellers may need to adjust expectations and pricing strategies as the market continues to evolve into 2025.
Sources: Norada Real Estate Investments, Zillow
3) Austin's closed sales dropped 3.5%, signaling a cooling housing market and potential price declines
In July 2024, Austin's closed sales fell to 2,652, a 3.5% decrease from last year, indicating a cooling housing market.
This decline suggests waning demand, possibly due to economic uncertainties or rising interest rates, prompting sellers to reduce prices.
As the market shifts in favor of buyers, housing prices in Austin are expected to continue declining into 2025, reflecting broader economic conditions and buyer sentiment.
Sources: Norada Real Estate Investments, Austin Board of Realtors
4) Austin's active listings jumped 9.3%, creating a supply surplus and potential price drops as buyers gain leverage
Active listings in Austin rose 9.3% year-over-year in October 2024, totaling 11,599 properties.
This increase indicates a supply surplus, leading to potential price reductions as sellers compete for buyers.
With more homes available, buyers gain leverage, prompting sellers to lower prices.
Consequently, housing prices are expected to decline into 2025, as the market shifts towards a buyer's market with supply exceeding demand.
If active listings continue to grow, prices will likely soften further.
Source: Austin Business Journal
- Why is Austin turning into a buyer’s market in 2025?
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5) Austin's sale-to-list price ratio dropped to 96.3%, so sellers are accepting lower offers
The sale-to-list price ratio in Austin fell to 96.3% in October 2024, down from 96.8% the previous year, indicating sellers are accepting lower offers as demand softens.
This shift suggests buyers have more negotiating power, possibly due to increased housing supply or economic uncertainties.
The consistent decline in this ratio points to a cooling market, with prices likely to continue falling into 2025.
This trend highlights changing housing market dynamics, where affordability and economic conditions are increasingly influencing buyer behavior.
If you're buying or selling in Austin, monitor these trends closely.
Source: Redfin
6) Austin's housing inventory hit 5.1 months, the market is cooling down
Housing inventory in Austin reached 5.1 months in October 2024, up from 4.6 months the previous year, indicating a market shift.
Increased supply relative to demand often pressures prices downward, as more options for buyers lead sellers to reduce prices.
This trend suggests a buyer-favored market, prompting sellers to adjust pricing strategies.
Consequently, housing prices in Austin are expected to decline into 2025, with growing inventory signaling a cooling market unless demand significantly changes.
Source: Austin Business Journal
7) Austin homes averaged 79 days on the market, which is quite high
Homes in Austin averaged 79 days on the market in October 2024, up from 66 days the previous year, indicating a shift in the real estate climate.
This increase in days on market (DOM) suggests reduced buyer urgency and demand, potentially leading to a buyer's market where sellers may lower prices to attract offers.
As homes linger longer, housing prices in Austin may continue to decline into 2025, with sellers needing to adjust pricing strategies to meet current demand.
The extended DOM signals ongoing downward pressure on prices, crucial for monitoring Austin's real estate market.
Source: Redfin
- Why is Austin one of the best places to start an Airbnb in 2025?
8) Austin's pending sales dropped 5.1%, signaling a cooling market and potential price declines into 2025
Pending sales in Austin decreased by 5.1% year-over-year in July 2024, with 2,567 transactions.
This decline indicates reduced buyer activity, leading sellers to compete more aggressively, often resulting in price reductions.
The cooling demand suggests potential buyers are holding off or unable to find affordable homes, possibly due to rising interest rates, economic uncertainty, or market saturation.
Consequently, housing prices in Austin are expected to decline into 2025 as sellers face a shrinking buyer pool.
This trend may create more favorable conditions for buyers, while sellers face a challenging market.
Sources: Norada Real Estate Investments, Austin Board of Realtors
9) Mortgage interest rates average 6.79%, making Austin homes less affordable and pushing prices down into 2025
As of November 7, 2024, mortgage interest rates average 6.79%, significantly affecting buyer affordability and reducing demand in the housing market.
High rates make homes less affordable, leading sellers to lower prices.
In Austin, this has increased unsold home inventory as supply surpasses demand, pushing prices down.
Many buyers are waiting for better conditions, further decreasing demand.
Consequently, Austin's housing prices are expected to decline into 2025, with high rates discouraging both new buyers and current homeowners from selling.
This highlights the impact of macroeconomic factors like interest rates on local markets.
Source: Austin Business Journal
10) Austin's rental vacancy rate is a whopping 11% (yes, it's actually high)
As of September 2023, Austin's rental vacancy rate was 11%, significantly above the national average of 6.6%, indicating a surplus of rental units.
This oversupply pressures landlords to lower rents, reducing rental income and potentially decreasing property values.
Renters benefit from more options and better deals, making real estate investments less appealing.
Consequently, housing prices in Austin are expected to decline into 2025, as the high vacancy rate and rental price pressure suggest a cooling market.
Potential buyers may delay purchases, anticipating further price drops, perpetuating the decline in property values.
Source: U.S.NEWS
11) The massive supply boost from Domain Northside's expansion might lead to a price drop
The expansion of Domain Northside has added over 600,000 square feet of retail space, 125,000 square feet of office space, and 563 new apartment units to Austin, potentially creating an oversupply.
This can lead to decreased housing prices as the market adjusts.
More apartment units mean more choices for renters and buyers, often resulting in lower prices due to supply and demand dynamics.
The same applies to retail and office spaces, where increased options allow businesses to negotiate better deals.
Consequently, Austin's housing prices are expected to decline into 2025 as the market absorbs the new supply, following a global real estate pattern.
Buyers and investors should monitor these trends.
Source: Northwood Investors
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So, is it a good time to buy in Austin? Yes, it is!
With Austin's housing market cooling down, 2025 presents a prime opportunity for buyers.
Several factors contribute to this favorable environment. The median home price has dropped by 3% to $430,000, and Zillow forecasts a further 2.7% decrease in home values. This trend is supported by a 9.3% increase in active listings, creating a supply surplus that gives buyers more leverage.
Additionally, the sale-to-list price ratio has fallen to 96.3%, indicating sellers are accepting lower offers. With homes averaging 79 days on the market and a 5.1-month housing inventory, the market is clearly shifting in favor of buyers. These conditions, coupled with a high rental vacancy rate of 11%, suggest that prices will continue to soften.