Houston Market Update - August 2025

We’re seeing some interesting shifts in Houston real estate. Rates are easing, buyers are coming back, and inventory is higher than it’s been in years. Here’s what that means for you.

Mortgage Rates & Buyer Activity

The average 30-year fixed has been trending downward since mid-July, now hovering just above 6.5%. As rates eased, we’ve seen more buyers in the $300K–$500K range reaching out, scheduling showings, and getting serious about their home search. In fact, over the last two weeks alone, we’ve gotten three first-time buyers under contract.

Looking back at the past two years, each time mortgage rates approach 6%, buyer activity noticeably increases. Even with today’s rates around 6.5%, momentum is building again, and if rates dip closer to 6%, expect competition among buyers to heat up quickly.

Inventory & Market Conditions

Months of Inventory has been climbing steadily throughout 2025. HAR’s most recent data shows we’re at 5.5 months of inventory, compared to just 1.3–1.6 months during the peak of the post-pandemic housing boom.

As I’ve noted in past updates, buyers are still being choosy. Homes still sell, but only if priced and marketed with care.

Are We at a Tipping Point?

It feels like we’re right at the edge of a shift. On one side, buyer activity is picking up; we’re busy with new meetings, showings, and contracts. On the other side, listings require deliberate effort and thoughtful strategy to secure strong offers.

The deciding factor may be mortgage rates. If they move closer to 6%, buyers will face more competition and the market could quickly tilt. There are early indicators this could happen. Labor data has been softening for 19 months, and if jobless claims rise, that may put further downward pressure on mortgage rates.

Final Thought

It feels like the market is mid-transition, balancing between buyer opportunity and seller strategy. Buyers who prepare now by getting pre-approved and clarifying their search criteria early will be positioned to move quickly if rates dip further. Sellers who position their homes thoughtfully will still find success, even in a choosier market.

As always, my role is to cut through the noise and help you make sense of the data so you can make confident decisions.