Welcome to your Austin Real Estate Market Update for Friday, February 20, 2026. Today’s Austin Daily Real Estate Briefing confirms that austin real estate remains in a supply heavy environment, with moderate demand, rising inventory compared to last year, and pricing that is still well below peak levels from 2022. The data continues to support a controlled correction phase rather than a freeze or a reacceleration.
Scroll down to view the full Austin Daily Real Estate Briefing PDF for February 20, 2026.
Active residential listings currently sit at 13,422, which is up 11.9 percent year over year compared to 11,995 at this time last year. While inventory is elevated versus 2025, it remains well below the previous high of 18,146 reached on June 30, 2025. That means the market has absorbed nearly 4,700 listings from peak supply levels. This is important. It shows that while we are not in a tight market, we are also not spiraling into excess inventory territory.
Of those 13,422 active listings, 48.4 percent have had at least one price drop. Nearly half of sellers have adjusted pricing. That statistic alone tells you what kind of environment we are in. Sellers are testing price, then repositioning to match buyer demand. For buyers, this creates negotiating leverage. For sellers, it reinforces the importance of accurate pricing from day one.
Breaking inventory down further, 4,011 listings are new construction and 9,411 are resale. The new construction segment continues to carry heavier supply pressure. Builders remain aggressive with incentives and pricing adjustments in order to move product, particularly in outer suburban markets.
Looking at supply flow, cumulative new listings from January through February total 6,542. That is down 16.4 percent year over year but still 6.6 percent above the long term average. Fewer sellers are entering the market compared to last year, yet listing activity remains historically healthy. This signals normalization, not collapse.
Pending listings currently sit at 4,062, which is up 2.4 percent year over year. On the surface, that looks positive. However, cumulative pending contracts from January through February total 5,373, which is down 18.5 percent year over year and 10.6 percent below the long term average. Demand is stable in the short term, but it is not running at historic expansion levels.
The Activity Index provides one of the clearest signals about market phase. Overall, the index sits at 23.2 percent, down from 24.9 percent last year. New construction is at 28.69 percent, while resale is at 20.64 percent. According to the market phase framework, resale is firmly in the softening category, which ranges from 20 to 25 percent. This reflects slower sales velocity and rising inventory. It is not a crisis environment, but it is not expansion either.
The Monthly New Listing to Pending Ratio is currently 0.66. For the year, the ratio is 0.71 compared to the 25 year average of 0.82. When this ratio runs below average, it indicates that new supply is outpacing contract activity. Year to date, there are 1,169 more new listings than pending contracts. That supply imbalance explains why price reductions remain common and why buyers retain leverage.
Months of Inventory now stands at 4.75 compared to 4.18 last year, a 13.7 percent increase. In resale only analysis, 4.75 months places most of the market in the neutral to buyer advantage range. The city of Austin specifically shows a negligible 0.1 percent year over year increase in months of inventory, but the two year increase is 13.5 percent. That tells you the shift began in 2024 and has continued gradually.
Sales volume also reflects a moderate slowdown. There were 1,918 homes sold in February. Cumulative sold properties from January through February total 3,601. That is down 7.1 percent year over year but still 8.4 percent above long term averages. In other words, we are selling fewer homes than last year, but we are not in historically weak territory.
However, when adjusted for population growth, cumulative sold per 100,000 residents is 135, down 9 percent year over year and 22.6 percent below average. Per 1,000 Realtors, sales are at 205, down 19.7 percent below average. That metric highlights competitive pressure among agents and thinner deal flow relative to industry size.
Now let us address pricing, which remains the most searched topic in any austin market update.
The average sold price in February is $550,518. The median sold price is $430,000. From the May 2022 peak, the average price has declined 19.27 percent, or roughly $131,000. The median has declined 21.82 percent, or $120,000. Those are significant corrections, but context matters. This retracement follows one of the fastest appreciation cycles in Austin history.
When tracking median sold prices versus 36 months prior, pricing is currently down 1.15 percent. That indicates stabilization relative to three year comparisons. The sharp year over year declines that defined 2023 and 2024 have largely flattened.
Looking at high versus low price tiers, the bottom 25th percentile experienced a 4.44 percent price decline year over year, with price per square foot down 6.10 percent. The top 25th percentile saw prices increase 2.54 percent, although price per square foot declined slightly. This shows that higher priced properties are holding value better than entry level inventory, likely due to constrained supply in luxury segments.
Across cities, 6 cities are up year over year while 24 are down. The Home Value Index categorizes 80 percent of cities as overvalued, 16.7 percent as fairly valued, and only 6.7 percent as undervalued. That suggests further normalization may still be required before broad based appreciation resumes.
The Absorption Rate, which measures sold listings divided by active listings, is 14.97 percent compared to a historical average of 31.54 percent. This confirms the market remains supply heavy relative to demand. Similarly, the Market Flow Score sits at 3.23 compared to the historical average of 6.58. The market is functioning, but it is not operating at high efficiency.
Looking forward, the long term austin housing forecast depends heavily on appreciation assumptions. Using the 25 year compound appreciation rate of 4.602 percent, if the median price of $430,000 represents the bottom of the correction, it would take approximately 67 months, or until August 2031, to return to the prior peak of roughly $550,000. That projection assumes normal appreciation resumes without another expansion surge.
For buyers, this environment offers negotiating power, price stability, and broader selection. For sellers, the path to success requires disciplined pricing, strong presentation, and realistic expectations. For investors, cap rate sensitivity and rent growth assumptions should be stress tested against slower appreciation cycles. For agents, productivity will depend on skill, market knowledge, and disciplined prospecting, not passive demand. This austin real estate forecast does not point to a crash, nor does it signal rapid appreciation. It reflects normalization after a historic boom. Inventory is manageable but elevated. Demand is steady but below peak. Pricing has corrected and appears to be stabilizing. The Austin housing market is in a softening to neutral phase, not a crisis phase.
