The Austin real estate market continues to show signs of cooling as we head into mid-July, with new data pointing to increased buyer leverage, slower activity, and price pressures across the region. This week’s Monday Touch Point dives into how weather events, inventory trends, and historical comparisons are shaping the current market—and what that means for both buyers and sellers. 

Impact of the Central Texas Floods on Market Activity

Over the weekend, severe flooding impacted parts of Central Texas, reminding us why this region is known as Flood Alley. Beyond the human toll, these events also influence the real estate market. Historically, floods and other weather events have suppressed new listings, and we're already seeing that happen. Many sellers have delayed bringing properties to market, contributing to a noticeable drop in new inventory.

In fact, the number of new listings for the past week fell to 861, a significant decrease largely driven by weather and holiday-related factors. Open house activity also saw a steep decline, with only 289 held across the region, reflecting the dual impact of July 4th and the storms.

New Listing to Pending Ratio: A Key Market Indicator
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The New Listing to Pending Ratio remains one of the most reliable leading indicators for the Austin market. For every two listings entering the market, only about one is being absorbed, placing the ratio at 0.56 this week. While this figure is higher than recent weeks, it is artificially propped up by the reduced number of new listings rather than an organic surge in buyer demand.

Looking back, the market saw a similar pattern during the May-June 2007 floods, when new listings plummeted, temporarily improving the ratio. However, the broader Hill Country flood this time around is unlikely to have the same market-wide effect within Austin proper, where the MLS carries limited Hill Country inventory.

Inventory Trends and Buyer Leverage
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Active inventory currently sits at 17,747 listings, a modest drop from the recent peak of 18,076 on June 27, 2025. Year-over-year, inventory is up 16.7%, reinforcing the significant increase in housing supply. Nearly 57% of active listings have experienced at least one price reduction—a clear sign that sellers are having to adjust to current market conditions.

The pending side of the market continues to lag, with only 4,307 properties under contract, down 5.7% year-over-year. The Activity Index, which tracks buyer demand relative to active listings, has slipped to 19.5%, while Months of Inventory has climbed to 6.32. These figures confirm that the market is shifting toward a buyer-favorable environment in many areas.

New Construction: The Data vs. The Narrative
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A common misconception is that new construction is flooding the market with excess inventory. However, the data tells a more nuanced story. Year-over-year, new construction inventory is actually down 1.03%, while resale inventory is up over 23%. New construction still accounts for roughly 23% of all active listings, but over 37% of pending transactions—highlighting continued buyer preference for new builds, particularly in areas like Hutto, Georgetown, and parts of Round Rock.

Where new construction is directly competing with resale—such as in certain suburban markets—resale homes are struggling to attract buyers. But this trend remains highly localized, with many Austin-area neighborhoods unaffected.

Pricing Trends and Market Cycle Insights
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Home prices continue to reflect the market’s cooling trajectory. The median sold price is down $2,500 month-over-month and year-over-year. The bottom 25th percentile of sales saw a 5.5% price decline, while the top 25th percentile also registered drops in both price and price per square foot.

The Sold-to-List Price Ratio for July sits at 97.2%, the lowest July reading since 2011. This data underscores the importance of realistic pricing strategies for sellers in today’s market.

Market Outlook and Agent Advice
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With 51% of Austin-area zip codes still classified as seller’s markets, the broader market remains highly segmented. However, 23 zip codes are now in a buyer’s market, and the trend is unlikely to reverse in the near term. As we approach the seasonal slowdown of late summer, new listings are expected to taper off, stabilizing Months of Inventory but leaving demand subdued.

Agents should stay nimble, relying on hyper-local data to guide pricing, open house strategy, and buyer negotiations. Real estate remains deeply localized, and understanding the nuances by city, zip code, and product type is key to success in the current environment.