Texas Housing Market Trends: Price Stabilization Amid Rising Inventory

After years of rapid appreciation, bidding wars, and inventory shortages, the Texas housing market is showing signs of shifting toward a more balanced state. In 2025, homeowners, buyers, and real estate professionals are watching closely as inventory rises and home prices begin to stabilize across major metro areas and secondary markets.

At Citadel Valuation Group, we work with residential and commercial clients across Texas to interpret how these shifts affect real estate valuations. Here's what we're seeing — and what it means moving forward:

1. Inventory Levels Are Up

Compared to the historically low inventory levels seen between 2020 and 2022, the Texas market now offers more options for buyers. Inventory is increasing in:

• Major metro areas like Austin, Dallas-Fort Worth, Houston, and San Antonio

• Emerging suburban markets where new construction has surged

This increase is partly due to new builds finally catching up to demand, but also because sellers are adjusting to a slower pace of appreciation.

2. Prices Are Stabilizing

While home prices remain higher than pre-pandemic levels, they're not rising at the breakneck pace we saw in recent years. Instead, price growth is flattening or softening slightly in many markets.

This is particularly true in:

• Areas where affordability has been stretched

• Suburban neighborhoods that experienced explosive growth in 2021-2023

For buyers, this stabilization means more negotiating power. For appraisers, it requires careful analysis of comps in an evolving environment.

3. Demand Is Shifting, Not Disappearing

Although rising interest rates have cooled demand slightly, Texas remains one of the top relocation destinations in the country. People continue to move to Texas for job opportunities, lower taxes, and lifestyle advantages.

Demand is simply becoming more selective, with buyers looking for value, location, and quality rather than rushing to secure any available property.

4. Builders Are Adapting

Homebuilders across Texas are responding by:

• Offering buyer incentives (rate buydowns, closing cost assistance)

• Adjusting home sizes and price points

• Accelerating completion of previously delayed projects

This is leading to a broader range of housing stock — which will likely further support inventory and price balance into late 2025.

5. What This Means for Property Valuations

For appraisers, stabilizing prices and rising inventory mean:

• A return to more traditional market behavior and comparables

• The need to factor in incentives, concessions, and updated cost data

• Closer evaluation of time-on-market and neighborhood-specific trends

At Citadel Valuation Group, we tailor our residential appraisals to reflect current, local dynamics. As the market shifts, it's more important than ever to rely on experienced professionals who understand these nuances.

Final Thoughts

The Texas housing market in 2025 is entering a healthier, more stable phase — but that doesn’t mean it’s predictable. Rising inventory and leveling prices create both opportunities and challenges for homeowners, buyers, investors, and lenders.

If you need an appraisal grounded in today's reality — not yesterday's hype — Citadel Valuation Group is here to help.

Citadel Valuation Group
Trusted Property Valuation Experts | Texas & Oklahoma
www.citadelappraisal.com