The real estate market in Texas has changed course in the last year. The waves of fast-rising home prices and bidding wars have settled, replaced by a calmer pace.
Some might see that as a sign of weakness, but many local experts believe it’s more like a return to normal. There’s still significant growth in parts of the state, and real estate fundamentals in Texas remain strong. People who hoped to buy a home but were priced out during the frenzy might feel relief now that buyers have more choices.
A Statewide Look at Texas Homes
Prices across the state shot up quickly during 2021–2022 and then began leveling off around 2023–2024. By early 2025, there was clear evidence of a balanced market in many places. Inventory is higher than in years, which helps reduce the intense competition that frustrates many buyers.
Sales Volume and Inventory
The number of Texas homes on the market rose significantly compared to last year. Some data suggests supply is 25% or more above previous figures in many localities.
Monthly home sales have slipped a few percentage points statewide, signaling that some buyers are waiting or reevaluating their budgets.
Average months of inventory have inched closer to 4 or 5 months in many regions. About 6 months of supply is considered balanced, so the state is leaning in that direction, a real contrast to the days of 1–2 months of supply.
Pricing Trends
Median statewide prices show tiny drops or are flat in much of Texas. That’s not a big crash, but it’s more like a leveling-off after significant spikes.
One reason for stable pricing is strong demand, fueled by the state’s job growth and continued in-migration. Companies keep moving to Texas, and the population continues to expand.
Time on Market
Many listings stay posted for a week or two longer than last year’s averages. In some regions, the number of days on the market is roughly 70 or more. That’s well above the lightning-fast sales cycles of 2021 when properties might only last a few days.
This shift gives buyers breathing room to schedule showings, line up financing, and make calmer decisions. On the other hand, sellers must recognize that pricing strategy matters now more than ever.
Where It All Stands
A balanced market can feel unfamiliar after intense bidding and repeated price jumps. Yet many industry folks say the current conditions are healthier in the long run. Sellers who price realistically still receive offers, and buyers aren’t forced to scramble.
Some are exploring rentals if they cannot secure a mortgage at higher rates or simply prefer to wait. This extra rental demand supports a solid lease market in most Texas metros.
Austin’s Residential Reset
Austin (Austin Board of Realtors ) once led the pack for fast price growth. Tech companies set up shops there, and so did many job seekers. The metro had multiple years of double-digit gains. That run cooled. Over the last year, inventory climbed to levels not seen since well before the pandemic.
Prices: Some data shows a modest dip in median home price compared to its peak. A median of around the low $400,000s is typical for the broader Austin area, though core areas remain pricier.
Sales Volume and Inventory: Active listings soared, and the market has inched above 5 months of supply. That figure is higher than most other big Texas metros. Buyers in Austin can browse more listings and request concessions more often.
Longer Days on Market: It’s not unusual to see 80 days or more for some Austin listings. That’s a shift from the prior pattern of homes going under contract in a few days.
Rental Scene: Some owners have decided to rent out properties without seeing their desired sales price. Median single-family rental rates are above $2,000 in many parts of the city, though some areas dipped slightly. That can still yield decent returns for investors who purchased before the price run-up.
Even with these changes, Austin remains among Texas’s more expensive metro areas. The city has robust job growth, especially in tech, which underpins demand. Many see this period as a breather for the market rather than a sign of severe weakness.
Dallas–Fort Worth Finds a Level
Dallas–Fort Worth is vast, spanning multiple counties with varied demographics. Overall, the area presents a picture of gentle normalization, with enough new supply to give buyers choices but not so much that prices plunge.
Prices: There are reports of stable median prices (around $400K region-wide). Dallas County or Tarrant County might differ by a small margin, but the general trend is that prices haven’t changed drastically year-over-year.
Rising Listings: The volume of active listings increased substantially, with some counties seeing a jump of 30% or more. That’s a big difference from the tight market a year or two ago.
DOM (Days on Market): Many properties are now selling within about two months, compared to one month or less in the past. A few extra weeks can mean the difference between frantic offers and a more thoughtful purchase.
Local Economy: DFW’s economy continues to grow, fueled by corporate relocations and population gains. That stability has prevented home values from sliding too much.
There are still pockets of competition, especially in sought-after suburbs or new construction communities with limited availability. Buyers have more bargaining power, but well-kept, reasonably priced homes can draw plenty of interest. Investors often like DFW for rental properties, too. Taxes can be high, but decent rents and consistent tenant demand keep them interested.
Houston’s Steady Rebalancing
Houston, with its focus on the energy sector, has seen housing cycles in the past. The city’s market is calmer than it was at the height of the pandemic boom.
Prices: Median figures in more excellent Houston hover in the low $300,000 range, maybe dipping by a small percentage compared to last year. Luxury segments saw slight gains, offsetting modest declines in middle-tier homes.
Plentiful Listings: Active listings climbed above prior levels, creating months of supply around four or more. That’s a far cry from the short supply a few years back.
Sales Pace: The number of days on the market has increased but remained relatively quick (some data suggests around two months). Houston’s broad economy—energy, medical, and shipping—helps keep buyer demand from falling too steeply.
Rental Market: People priced out of buying or uncertain about mortgage rates often switch to leasing. Single-family rentals have been more abundant, and Houston’s average lease price is in the low-to-mid $2,000 range.
Local analysts say Houston is now where buyers can negotiate but can’t necessarily expect prices to collapse. Sellers have to price more thoughtfully, yet in many instances, homes still move if they offer good value.
San Antonio Balances Affordability and Inventory
San Antonio is the most affordable big city among the four largest metros in Texas. It has nearly reached a balanced state, with around five months of supply.
Prices: Data suggests a median near the high $200,000s or low $300,000s. That’s notably lower than in Austin or DFW, drawing first-time buyers or those seeking more budget-friendly options.
Supply and Demand: Active listings rose significantly, so the months of supply figure now hovers around 4.5 or 5. That gives buyers a variety of choices without flooding the market.
Sales Volume: The city’s closed sales dipped slightly, in line with other Texas metros. Still, homes that enter the market at competitive prices see steady interest.
Rental Market: Monthly rents remain lower than in Austin or Dallas. Single-family rentals average around $1,700–$1,800. That’s attractive for investors because purchase prices are also lower, which can yield a better ratio than in pricier metros.
Local agents say a balanced San Antonio market lets people shop around and compare neighborhoods. Sellers need patience, but they find that deals happen if they avoid overpricing.
If you want to see what MLS association are in the region you can read this article: Multiple Listing Services(MLS) in Texas.
Commercial Real Estate Across Texas
The residential story focuses on rising inventory and flat prices, but commercial real estate has its paths. Office vacancies in many cities remain elevated. Industrial properties are hot, and retail or multifamily are somewhere in between.
Office Headwinds
Remote and hybrid work has shaken the office market. Houston, Dallas–Fort Worth, and Austin each face high vacancy rates. San Antonio is better off, but vacancies there have also climbed from historic norms.
- New sublease listings flood the market when companies downsize their office space.
- Older downtown towers struggle to compete with modern, suburban campuses.
- Some owners explore repurposing floors into apartments or mixed-use layouts.
This means tenants have the upper hand. They can request tenant improvements, free rent periods, and other concessions. Offices in prime areas, such as The Domain in Austin or upscale parts of Dallas, still lease well, but older buildings need a major refresh or discounted rents to lure tenants.
Industrial Strength
Distribution, logistics, and warehouse space remain plentiful. Texas’s central location and strong population growth make it prime for e-commerce.
- Vacancy rates for industrial properties typically stay well under 6%.
- Developers keep constructing massive facilities near highways, ports, or rail lines.
- Companies like Amazon, Tesla, and FedEx have expanded distribution hubs, feeding more industrial leasing.
Rents for industrial properties climb steadily, and the quick absorption of new supply implies continued interest from manufacturers and shippers. Investors flock to industrial sites because they see stable returns in areas with minimal vacancy.
Retail Resilience
Retail real estate looked vulnerable when so many transactions went digital. Yet Texans support brick-and-mortar shops, especially in bustling suburbs or near new housing developments.
- Grocery-anchored centers and power centers with major brands stay in high demand.
- Older malls or big-box stores might require fresh ideas, though certain malls have done well by adding restaurants or entertainment.
- Populations relocating to suburban areas or smaller cities need more services, so new retail projects often pop up there.
Many Texas shoppers visit both physical stores and online options. Landlords focusing on experience-driven or essential retail have seen stable occupancy and moderate rent growth.
Multifamily in Transition
Rent growth in apartments across Texas reached a high point around 2021 and moderated in 2024. Vacancies rose a bit, especially in Austin’s urban core, where many new units arrived at once.
- Some markets show rent increases close to zero, though the long-term upward trend remains.
- New units keep delivering, which might reduce owners’ bargaining power in the short term.
- The cost of borrowing money for multifamily investments rose, so some deals slowed.
Even so, population growth keeps occupancy above 90% in many cities, and investor interest remains steady. Many renters prefer new apartment buildings with modern amenities, giving older complexes a reason to renovate or drop rents to stay competitive.
Other Commercial Segments
- Data Centers: DFW, in particular, has grown as a data center hub due to available power, land, and fiber connectivity. Some owners convert old industrial sites into data centers for cloud providers.
- Hospitality: Tourism grew in places like San Antonio, which helped hotels bounce back. Business travel in Houston or Dallas has also increased, though it’s not entirely back to pre-pandemic levels.
- Rural Land: Farm or recreational land in Texas continues to change hands, supported by the state’s property rights culture and buyer interest in large acreage.
Commercial real estate is not uniform. Office spaces may struggle for years, while industrial or data center sites appear to thrive. Each metro’s local economy adds another layer to that story.
The Road Ahead: Interest Rates and Confidence
Many real estate watchers wonder how interest rates will influence the next phase. Rates moved up and changed buyer affordability, but if they flatten or dip a bit, more buyers might reenter the market. Mortgage applications can jump quickly if rates drop even half a percentage point.
Jobs and population growth remain sturdy in Texas, which is why many experts expect the real estate market to avoid a drastic downturn. The run of extreme price gains is over, replaced by a gentler pace, which can actually help keep the market from overheating again.
Sellers or landlords who want top results must adjust to these cooler conditions. That can mean:
• Marketing real estate more carefully to stand out from the expanded inventory.
• Setting realistic list prices from the start to avoid drawn-out negotiations.
• Considering upgrades or repairs that might not have been needed when the market was running hot.
On the other hand, buyers can explore the pros and cons of locking in a mortgage now vs. waiting. If they plan to own a home for many years, the difference in monthly payment might be offset by having more options and negotiating a better deal. In many Texas areas, the days of offering thousands above list price with zero contingencies have passed.
Tips for Agents and Investors
Agents who relied on easy sales during the boom now must actively market properties and use tools like 3D tours or local data. Showcasing properties on major portals is still a must, but it’s also wise to keep an agent’s website updated with an IDX feed—possibly with help from a solution like mlsimport.com, which can keep listing info fresh and accurate.
Investors continue to monitor single-family rentals, multifamily properties, and industrial real estate. Office deals are riskier, although there might be bargains for those willing to remodel or reposition older sites. Retail is stable in many Texas suburbs, but location matters: the new growth corridors are magnets for fresh developments, while older spots might face challenges.
Local Differences, Common Threads
Each major metro—Austin, Dallas–Fort Worth, Houston, and San Antonio—has its own identity. They don’t all move in perfect sync, yet they share broader themes. The pattern in 2025 is that supply has caught up, sales volume is normal, and prices have leveled. Some places saw sharper adjustments, like Austin, which soared the highest and had the most significant shift back. Others, like San Antonio, barely soared in the first place and thus barely dropped now.
Commercial real estate is also following a two-way path. Office space is abundant, leading to high vacancies. Industrial and warehouse space is in short supply. Apartments are coping with new deliveries, but overall occupancy remains healthy. Retail stands on solid ground in growing areas.
There’s no single statewide blueprint for investors or home seekers, but there is a consistent theme: the market is less frantic and more stable than it was. People can do more due diligence and weigh decisions carefully. Many see that as a welcome shift after the prior intensity.
A Balanced Year Ahead
Judging by the current data and the job landscape, 2025 looks like a year of balanced real estate in Texas. Price surges may be minimal, and sellers might face mild downward pressure in some markets if they overprice. Conversely, there’s enough demand in fast-growing metros that total collapses appear unlikely.
Those who own property and want to sell should align with local market realities. Buyers and renters can enjoy a better selection. Agents and developers might pivot to thoughtful marketing, meeting the needs of more cautious prospective clients.
Many local economists see these conditions as a healthy reset. Texas is still growing, so a soft landing is the likely path rather than a crash. People looking at the long term can find opportunities in a market with less frenzy. Newcomers to Texas can shop around without out-of-state buyers outbidding them instantly.
There are always wildcards, including national economic trends, oil prices (which affect Houston), or the tech sector’s performance in Austin. Yet all signals suggest that a balanced environment is here, at least for the near future. The office sector remains the primary concern, but other commercial real estate segments appear solid.
Those wanting a stable path can appreciate that real estate in Texas continues to move forward. The big run-up has ended, but a more normal pace has arrived, showing staying power.
