If you were trying to purchase a home in Austin in 2025, it might have been a tad less painful on your pocketbook than it was two years ago. That is because home prices have dipped slightly, and there are more homes on the market for sale. <\/p>\n
Buyers and sellers should expect more of the same heading into 2026, according to market research shared by the Austin Board of Realtors<\/a>.<\/p>\n Vaike O’Grady, a market research advisor with the Austin Board of Realtors, said the market has started to cool a bit, meaning prices are continuing to drop. That comes after years of volatility that included high mortgage interest rates and swings in home prices.<\/p>\n \u201cOverall the market didn’t really suffer on the pricing side, which is good and bad,\u201d she said. \u201cSellers are happy that they are getting what they are asking for if they are pricing it correctly, but it doesn’t make it easier for buyers. However, inventory is up and that signals to me that we probably will see pricing softening as we enter the first part of 2026.\u201d<\/p>\n A steady market\u00a0<\/p>\n The market\u2019s steadiness is defined by a few things: mortgage rates, home prices and how many homes are for sale.<\/p>\n Mortgage interest rates, which help determine monthly payments, are hovering around 6%. O\u2019Grady said researchers expect those rates to remain around the same and possibly even continue to dip in 2026. While rates are relatively high compared to pandemic-era numbers, they have been coming down. If the rates stay level or even drop a little more in 2026, it will be good news for buyers. The lower the rate, the less it will cost to buy a home.<\/p>\n Meanwhile, home pricing remained relatively flat. The median home price in the Austin-Round-San Marcos Metropolitan Statistical Area hit $439,000 in October, which is about a 1% increase year over year. That is down from the peak of $480,000 in June 2023, according to data from the Austin Board of Realtors.<\/p>\n \u201cWe\u2019ve been fluctuating between $420,000 and $480,000 as a median sales price for a couple of years now,\u201d O\u2019Grady said. \u201cWe\u2019ve kind of settled into that price band market-wide.” <\/p>\n But she said home prices in suburban areas are not as high and should stay lower than in Austin’s core as more homes are built there. <\/p>\n She said that is likely due to the number of homes available to sell being up in areas outside of Austin, including Williamson, Hays and Bastrop counties and in San Antonio. As the law of supply and demand dictates, more homes for sale can mean lower prices. <\/p>\n \u201cPeople want to stay in Texas but they are looking a little further out,\u201d O\u2019Grady said. \u201cBuilders are going into urban locations that they wouldn’t have considered a few years back, because they want to be able to provide housing that people can actually afford.\u201d<\/p>\n What’s ahead in 2026?<\/p>\n Tommy Tucker, a local home builder and president with the Home Builders Association of Greater Austin, said it was a tough year for new home construction considering the shock value of tariffs on the cost to materials and labor. But things have started to normalize in the last several months.<\/p>\n \u201cIt’s better than it was in the spring when it was chaotic with lumber, concrete and steel going up [in price,]\u201d Tucker said. \u201cThose have seemed to have stabilized \u2026 These are commodities that we are dealing with so they do fluctuate.\u201d<\/p>\n Heading into 2026, Tucker expects things to continue to improve and balance out<\/p>\n \u201cWe are starting to see a bit more of an equilibrium in terms of supply,\u201d he said. \u201cThe market is not great, but it seems to be stabilizing and getting to more of a middle ground.\u201d<\/p>\n As the prices of homes stayed flat in 2025, Austin city leaders have said they hope changes to its home construction rules will help bring down housing costs. <\/p>\n Austin’s Home Options for Mobility and Equity, or HOME initiative<\/a>, aims to create more housing and different types of housing to make home buying more affordable. <\/p>\n