T
he Austin metro area's housing market is expected to remain stable in 2025, with experts predicting a repeat of the trends seen in 2024. Home prices are likely to remain relatively flat, with a steady supply of housing and predictable mortgage interest rates. This stability will give homebuyers and sellers clear expectations to plan their next steps with greater confidence.

    For house hunters, the growing supply of homes means more choices and potentially lower prices. Some sellers may have to consider lowering their asking prices to attract buyers as inventory swells and mortgage rates hover in the 6% range. Mortgage rates are projected to stay in this range during the first half of the year but could dip into the 5% range later.

    Experts say historically, the health of the local economy and mortgage interest rates have been the biggest factors affecting demand for housing. With job growth slowing and interest rates remaining high, these variables will continue to represent headwinds for the housing market in 2025.

    Home prices are expected to moderate further in 2025 as sellers adjust prices to accommodate affordability pressure from prospective homebuyers dealing with high interest rates. The median sales price is likely to remain essentially flat, up or down by 5% year-over-year.

    The new home market will continue to offer opportunities for buyers, with builders buying down rates and negotiating on inventory homes. However, sellers of resale homes will need to be more realistic about pricing to stay competitive with new construction homes that can offer financial incentives and mortgage rate buydowns.

    Experts predict Austin's population and economy will continue to grow, fueling demand for homeownership. The region's strong economy is a key factor in the housing market, and billions of dollars of investment are expected to strengthen it further.

    For buyers, the new home market has fantastic opportunities, with builders buying down rates and negotiating on inventory homes. For sellers, they should carefully weigh buyers' affordability amid still-elevated mortgage rates and the significant uptick in supply.