Austin Realtors economist predicts 2025's housing market to follow 2024's trends

AUSTIN (KXAN) -- Home sellers and potential buyers in the Austin-Round Rock-San Marcos metropolitan statistical area (MSA or metro) should expect local housing market trends in the new year to resemble 2024 and 2023, according to Austin Board of Realtors (ABoR) housing economist Dr. Clare Knapp.

"In 2024, the Austin housing market was really one of steady goes it. We saw that the median sales price and closed sales were fairly steady on a year-over-year basis," said Knapp in December 2024. "Essentially, what we saw in 2023 we kind of repeated in 2024."

KXAN previously interviewed Knapp in 2023 about her predictions for the 2024 Austin metro housing market. Then, she said that Austin would reach "healthier levels" in the market, and that changes would be more subtle.

"[Interest rate changes] may boost demand for homeownership to a certain extent, but I would generally anticipate that we aren’t going to see any significant swings in the housing market," said Knapp in 2023. "Any sort of housing policy initiative is going to take a while to trickle down into the market for new home supply."

The metro's housing inventory is up or equal month-over-month compared to 2023, according to ABoR's data.

"We're sitting at an over...13-year high in terms of months of inventory and of course that provides a big boost to buyers," Knapp told KXAN in December. "They have more opportunities across the board in terms of what they're looking for and a little bit more negotiating power when they're working with sellers."

She notes that affordability will continue to be forefront for potential buyers. Sellers will continue to benefit in year-over-year increases in local home prices, while increased inventory will help out buyers.

Cooling migration to Austin will be a benefit to the local market as well, and may help with the metro's affordability, Knapp said.

"It will give us more time to just catch up to the fact that we are still very much grappling with those affordability constraints," she said. "Although our inventory of homes has increased over 2024, which is great news, we're still seeing a little bit of limited inventory within the lower price categories."

Data visualization created by KXAN data reporter Christopher Adams.