Austin Market Sentiment Is Shifting — And the Data Confirms It
This week’s Monday Touch Point confirmed something that has been quietly developing across the country: the real estate narrative is changing. Conversations with buyers, agents, and even people outside Texas are aligning with what Austin data has shown for years — inventory pressure is real, caution is growing, and affordability is finally re-entering the conversation. The key question is no longer whether the market corrected. That already happened. Now the question is what comes next.
Affordability Has Quietly Reset — But Payments Haven’t
One of the most important metrics I track is the median sold price-to-income ratio. For November, that ratio came in at 3.89, which matches 2015 affordability levels. That’s a massive reset from the peak and confirms that price correction has done meaningful work. However, affordability is still constrained — not by prices alone, but by PITI. Even with prices back to historical ratios, higher mortgage rates, rising insurance costs, property taxes, and HOA fees have kept monthly payments elevated. In 2015, the average PITI was about $1,682. Today it is closer to $3,520 for the same ratio. This explains why buyers are active but hesitant. The math on paper looks better, but the monthly obligation still feels heavy.
New Listings vs Pending Activity Signals Growing Imbalance
The single best leading indicator we have is the new listing-to-pending ratio, and this week it opened at 0.59. For context, we ended last week at 0.99, and the week before at 0.91. We are seeing fewer pendings relative to listings, more back-on-market activity, and year-over-year softness re-emerging after a brief stabilization period. Pending activity is running meaningfully below last year, while inventory continues to build. Sellers are entering the market earlier, hoping to “get ahead” of others — which is causing the spring selling cycle to start sooner and with more competition.
Buyers Are Active — Just Not Willing Yet
Buyer interest is real. Website traffic, search queries, consultations, and conversations are all up. The issue isn’t readiness or qualification. It’s willingness. Buyers are waiting because they believe — correctly — that prices may still face additional pressure. In many Austin zip codes, prices are already down 22% to 35% from peak. That creates opportunity, but also caution. This is where agent strategy matters. The right approach is transparency. Acknowledge that prices could soften further, but also explain that negotiated opportunities exist today. Waiting carries risk too — especially if rates shift faster than prices.
Appraisal Risk Is Back — Prepare for It
One major change agents need to internalize is the return of appraisal risk. Back-on-market activity is no longer driven by buyers juggling multiple offers. It is increasingly tied to financing and valuation mismatches. This is the moment where listing agents must treat appraisals like showings. Appraisal packages matter. Presentation matters. Human psychology matters. A clean, prepared home with clear supporting data can and does influence valuation outcomes.
Sold Volume Is Weak — But the Reason Matters
Sold activity is down 16% year-over-year, the steepest decline since late 2023. That sounds alarming until you understand the composition: new construction now represents a larger share of pendings, and those properties take longer to close. The lag is structural rather than purely demand-based. At the same time, withdrawn and expired listings are climbing. More sellers are opting to pause rather than chase the market — and many of those homes are likely to relist in the spring, adding additional inventory pressure.
Multifamily Is Applying Downward Pressure to the Entire Market
Multifamily pricing declines are now feeding directly into single-family softness. Several Central Texas cities rank among the largest rent declines in the country, with some markets down over 20% from peak. When renters can access new, amenity-rich apartments at competitive prices, the urgency to buy fades — especially for younger households prioritizing flexibility. This dynamic will continue to cap upward pressure on resale pricing.
The Market Is Stuck — Not Broken
The activity index has been hovering near 20%, what I call the danger zone. This isn’t collapse; it’s stagnation. Properties are selling, but slowly. Pricing precision matters more than ever, and generic strategies fail quickly. The path forward isn’t prediction — it’s execution. Agents who adapt, communicate clearly, and stay disciplined will build pipelines now that convert when confidence returns.
