This week’s Monday Touch Point highlighted how temporary distortions are complicating the reading of Austin’s housing market, even as underlying trends become clearer. January weather disruptions delayed listings and pendings, but beneath that noise, supply growth is slowing, new listings are running below last year, and activity is becoming increasingly submarket-specific. Sold data remains weak due to late-2025 contract slowdowns, while leading indicators such as the new-listing-to-pending ratio and activity index are stabilizing or improving. Elevated price reductions and withdrawals continue to reinforce a central reality: buyer behavior is being driven by value alignment and affordability, not optimism or rate headlines, and outcomes now depend on disciplined pricing and hyper-local strategy.

Austin’s Market Signals Are Improving, but Context Matters

This week’s Monday Touch Point focused on separating noise from signal in the Austin real estate market. January closed with data that, at first glance, looks mixed. Sold activity is weak, headlines are lagging reality, and many consumers are still reacting to backward-looking indicators. But when you focus on leading indicators, especially new listings, pendings, and the activity index, the market is showing clear signs of stabilization and selective strength.

The most important takeaway right now is that weather events and seasonal distortions are heavily influencing short-term numbers. The January freeze delayed listings, canceled showings, and pushed pendings into future weeks. That matters when interpreting ratios and weekly drops.

New Listings vs Pending Activity

The new listing-to-pending ratio remains the most reliable leading indicator we track. After six straight weeks of underperforming last year, the market has now posted four consecutive weeks outperforming the same weeks in 2025. That is encouraging.

January finished with approximately 1,291 pendings and 1,571 active under contract listings, producing a ratio near 67, only slightly below January 2025’s 69. On a year-over-year basis, new listings were down about 5 percent for the month, while pendings were down roughly 8 percent. This keeps January broadly in line with last year, despite severe weather disruptions. The key detail is supply. Fewer new listings are entering the market compared to last year, which limits inventory growth and supports activity where demand exists.

The Sold Data Problem and Why It’s Lagging

The most striking statistic from January is the 22.6 percent year-over-year drop in sold properties. Even adjusting for population, sold activity is down more than 24 percent. That is a large decline, and it will influence comps, pricing conversations, and appraisals.

However, sold data reflects decisions made in November and December, not today’s demand. The weakness in solds is the delayed consequence of fewer pendings late last year. Leading indicators are already improving, which means sold numbers should recover over the next several months.

Agents must understand this distinction clearly. Pricing and negotiations must acknowledge lagging comps, but strategy should be guided by current activity, not outdated momentum.

Inventory and Activity Index Trends

Active inventory remains contained. Current active listings sit around 12,764, up roughly 11 percent year over year, far lower growth than many expected. Pending listings are actually slightly higher than the same date last year, up about 1 percent.

The activity index continues to improve. Several zip codes have reached 12-month record highs, with some areas firmly back in multiple-offer territory. Importantly, activity gains are highly localized. One zip code can be competitive while a neighboring area remains sluggish. Hyper-local data matters more now than ever.

Roughly one-third of tracked zip codes are under four months of inventory, and more than half are under five months. That is a materially healthier environment than headline narratives suggest.

Pricing Reality and Market Bifurcation

January pricing data reinforces a bifurcated market. The median sold price declined month over month by roughly $19,000 and is essentially flat year over year. The bottom quartile of the market is down about 5 percent, while the top quartile is still appreciating modestly.

This means quality, location, and price discipline matter more than timing alone. Well-positioned homes in strong submarkets are still selling competitively, while marginal inventory faces pressure.

Rates, Bonds, and the Week Ahead

Mortgage rates are holding steady near recent levels, with conventional rates around 6.25 percent and FHA and VA below 6 percent. This week is critical for rates due to heavy Treasury supply, labor data, and inflation expectations.

Manufacturing data surprised sharply to the upside, signaling economic expansion. That is positive for the economy but creates upward pressure on rates as capital rotates away from bonds. Inflation data next week will likely be the next major rate catalyst.

Big Picture Outlook

Austin has already absorbed most of its price correction. Roughly 85 percent of the adjustment appears complete, and leading indicators suggest the worst is behind us. While sold data will take time to recover, demand signals, constrained supply, and improving activity point toward stabilization and selective growth. This is no longer a one-speed market. Success now depends on reading leading indicators, understanding submarket dynamics, and explaining data clearly to clients.