Inventory Rises to Neutral Territory

The Austin housing market is showing signs of shifting toward a more balanced environment, with the latest data indicating 6.05 months of inventory available. This figure places the market in the neutral-to-buyer territory, as a balanced market is typically defined as having between five and seven months of inventory. For comparison, the market’s lowest point in recent years occurred in March 2021, when inventory reached just 0.65 months, signaling a strong seller’s market. The highest inventory over the past two decades was recorded in July 2010 at 8.72 months, during a more challenging sales environment.

Active residential listings currently stand at 17,445 properties. This marks a significant increase from the tight inventory levels of the pandemic years, when active listings fell to just 2,497 in March 2021. Historically, active listings have fluctuated in response to broader economic conditions, population growth, and seasonal trends. The current level represents a return to inventory availability similar to the mid-2010s, offering buyers more options and reducing the intense competition seen in recent years.

Month-to-month trends in 2025 reveal a steady upward movement in inventory compared to earlier in the year. January opened with 4.32 months of supply, gradually climbing through the spring. By May, inventory reached 6.33 months, peaking in June at 6.54 months before slightly moderating to 6.39 in July. This gradual increase reflects a cooling pace of sales relative to the number of homes on the market. In contrast, the first half of the last decade saw monthly inventory levels consistently above six months, with the market leaning more toward buyers.

Looking back over the last 20 years, the data illustrates several distinct cycles. From 2005 to 2009, months of inventory ranged between 3.5 and 7.0, with a spike during the financial crisis. The period from 2010 to 2012 marked a high-inventory environment, with levels frequently exceeding eight months. Beginning in 2013, the Austin market experienced a sustained drop in inventory, reaching historic lows during 2020 and 2021 when months of supply stayed below one month for extended periods. This extreme shortage contributed to rapid home price appreciation, bidding wars, and reduced negotiation leverage for buyers.

The current 2025 conditions, with inventory over six months, signal a markedly different environment from the frenzied pandemic years. Buyers now have more opportunities to explore properties, negotiate terms, and conduct thorough due diligence without the same urgency that defined recent markets. Sellers, on the other hand, may need to adjust pricing strategies and marketing approaches to compete in a market where buyers have more choices.

The long-term data suggests that inventory levels play a central role in shaping market dynamics. As Austin’s market continues to evolve through 2025, maintaining a close watch on months of inventory will provide valuable insights into whether conditions are trending further toward buyers, returning to balance, or tightening again in favor of sellers.