213: Texas Housing Market 2025: Why Homes Aren’t Selling Like They Used To

Home SellingSelling Real EstateCalifornia Real EstateReal Estate InvestingHome Buying 101

Oct 14

Why Texas Homes Are Struggling to Sell in 2025: A Market Reality Check

The Texas housing market is cooling down — fast. According to the Texas Real Estate Research Center, active inventory in June 2025 hit 156,000 homes, up nearly 20% year over year, marking the highest level in a decade. Homes are sitting on the market for a median of 36 days, and sellers are slashing prices to attract hesitant buyers.

So, what’s really going on?

1. High Prices Outpaced Income Growth

For years, Texas was known for affordability — but that’s changed. The median home price in 2025 sits around $331,000, while average wages have only grown about 4%. Meanwhile, home prices have surged nearly 40% since the pandemic. Zillow reports the state’s average home price at $304,000, still above what many buyers can comfortably afford.

When you factor in mortgage rates hovering between 6–7%, monthly payments for a $330,000 home total roughly $2,300–$2,500 after taxes and insurance. For many families, the math just doesn’t work. Buyers are taking a step back — not because they don’t want to buy, but because they simply can’t afford to.

2. Rising Inventory and Slowing Demand

Texas currently has 5.7 months’ worth of inventory, up from 4.5 months last year, tipping the scales toward a buyers’ market. Builders are still completing new homes, sellers keep listing, and buyers aren’t rushing in. The result? More competition and slower sales.

3. Sellers Are Stuck in the Pandemic Mindset

Many homeowners are still pricing their homes based on 2021’s peak. But the reality is different now. As buyers compare options and wait for price drops, sellers who hold out for “yesterday’s prices” risk being left behind. The truth? Equity means nothing if you can’t sell your home.

4. Regional Cooldowns

Zooming in reveals more signs of slowdown:

Austin: Sales down 9% in Q1, listings up 19%, median price down 2.3%.
Houston: Active listings jumped 34%, price growth flat for the first time since 2011.
Dallas: Homes taking longer to sell, with sellers offering more concessions.
San Antonio: Still relatively affordable, but homes are sitting longer here too.

Across major cities, the trend is clear — homes are staying on the market longer, and sellers are having to adjust expectations.

What It Means for Buyers and Sellers

For sellers, this is the time to be realistic. Price competitively, be open to concessions, and understand that today’s buyers want turnkey homes. Overpricing will only keep you on the market longer.

For buyers, this is a window of opportunity. You have leverage. Don’t be afraid to negotiate — whether it’s for price reductions, closing cost credits, or upgraded appliances. Compare new builds versus existing homes, as builders are eager to move inventory.

For investors, Texas may be entering a sweet spot. Slower appreciation and higher inventory mean better opportunities to negotiate long-term deals.

What’s Next for Texas Real Estate?

Most forecasts predict modest home price growth of 1–3% in 2025, a far cry from the double-digit surges of recent years. If mortgage rates ease later in the year, demand could pick back up — but for now, the market is recalibrating.

The Bottom Line

The Texas real estate market isn’t crashing — it’s correcting. After years of rapid growth, the market is finding its balance again. For sellers, it’s a reality check. For buyers, it’s an opportunity. And for investors, it’s a market to watch closely.

If you’re buying or selling in Texas, the key is patience, strategy, and realistic expectations. The market may be cooling, but smart moves now can pay off later

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