From Newsweek · · 1m 20s
Texas Housing Market Faces Sharp Correction
Texas housing inventory glut threatens nationwide affordability as prices drop 9.2% since 2022 peak
In brief
Texas housing inventory glut threatens nationwide affordability as prices drop 9.2% since 2022 peak Texas' housing market correction could lower prices by 9.2% but requires affordability improvements to clear inventory Originally reported by Newsweek.
Texas housing glut
Texas added 2.1 million residents between 2020-2024, spurring record home construction.
“High mortgage rates and still-high home prices have dampened demand and allowed homes to stack up on the market”
Price correction underway
Texas home prices fell 9.2% since 2022 peak while inventory grew 76.2%.
“Since the peak, which we will define as August of 2022 for comparison, Texas has seen for-sale inventory grow by 76.2 percent and prices fall by 9.2 percent”
Supply-demand imbalance
Texas housing inventory now twice monthly sales with 48% of listings cut in price.
“Housing inventory on the state’s market is now roughly twice as high as monthly sales”
Texas vs Florida comparison
Texas added 50% more housing than Florida since 2020 with higher price pressure.
“Over the past five years, Texas added roughly 50 percent more housing than Florida”
Affordability challenges
Mortgage rates near 7% and high home prices hinder Texas homebuyers.
“Texas is dealing with a supply glut that was largely built for a very different demand and affordability environment”
Market correction timeline
Texas may see 25% inventory growth in midsize cities by summer 2025.
“Midland, Waco, and Tyler, where the number of homes for sale is up over 25 percent compared to last August”
Builder response
Texas homebuilding permits fell 7.4% from 2024 to 2025 with single-family permits down 11.7%.
“Total permits issued for new homes in Texas fell by 7.4 percent from 2024 to 2025”
National impact
Texas market slowdown could affect national housing statistics through 2025.
“Texas is large enough that a major slowdown would appear in the national statistics for things like home prices”
Market reset potential
Texas may clear inventory at lower prices by summer 2025 with healthier market trends.
“From there, the market can reset and resume healthier trends off a more normalized base”
Sunbelt context
Florida and Texas both experienced housing inventory growth but Texas has deeper correction risks.
“Texas has a larger supply problem. Over the past five years, Texas added roughly 50 percent more housing than Florida”
The big picture
Texas' housing market correction could lower prices by 9.2% but requires affordability improvements to clear inventory
