New home sales across Texas eased in June 2026, extending a pullback that began after the spring market peaked in May, according to market data tracking the state’s four largest metropolitan areas. Sales in May had reached 6,339 homes statewide, but the three-month moving average began declining as affordability pressures and mortgage rates in the mid-6 percent range kept buyers cautious.
Active inventory across Texas metros rose year-over-year by double digits in some markets, with San Antonio up 12.6 percent, Houston up 7 percent, and Austin up 3.2 percent. The combination of slowing sales and rising supply marks a sharp reversal from the seller’s market that defined much of 2021 and 2022, giving today’s buyers more negotiating power than they’ve had in years.
The slowdown affects buyers, builders, and sellers differently depending on location and price point. Resale home sales have shown more resilience in some metros, but new construction inventory—much of it still under construction or not yet started—continues to pile up as builders balance production against softer demand.
The numbers
Sales slow as inventory reaches cycle highs
New home sales declined across three of Texas’s four major markets in the spring, while available listings climbed to levels not seen since before the pandemic.
In May 2026, the most recent month with complete data, Texas recorded 6,339 new home sales, with Houston leading at 2,169 sales, followed by Dallas-Fort Worth with 2,122, San Antonio with 1,179, and Austin with 868. Year-over-year, statewide sales were down from 6,443 in May 2025. The three-month moving average used by HomesUSA.com—which tracks new home sales reported to local Multiple Listing Services—showed the market losing momentum as the peak spring season wound down.
Current inventory sits approximately 1.4 to 1.5 times pre-pandemic 2019 levels, according to the Texas Real Estate Research Center at Texas A&M University, the state’s authoritative source for housing data. At the start of 2026, there were approximately 128,100 active listings statewide, 13.7 percent above the prior year. By spring, that inventory continued climbing even as the traditional busy season began.
The pattern mirrors what happened in June 2025, when the three-month moving average of new home sales dipped to 6,394 from May’s 6,443, and industry forecasters predicted sales and prices would drift lower for the remainder of that year unless mortgage rates fell. This year, mortgage rates have remained in the mid-6 percent range, keeping monthly payments elevated and constraining buyer demand even as more homes come to market.
Key figures: Spring 2026
6,339 new home sales in Texas in May 2026, down from 6,443 a year earlier. 128,100 active listings statewide at the start of 2026, up 13.7% year-over-year. San Antonio led inventory growth at +12.6% YoY, followed by Houston at +7% and Austin at +3.2%. 70 days average time on market in April 2026 for sold homes statewide, down from 79 days in March but still above 2024 and 2025 levels.
The context
Why the Texas market is cooling
Affordability pressures, rising property taxes, and insurance costs are weighing on buyer demand across all price tiers.
Home price declines began in June 2025 and extended through April 2026, marking 11 consecutive months of year-over-year weakness. The pace of statewide price declines has held relatively steady at roughly 0.5 to 0.7 percent year-over-year, with April recording the largest declines so far. Price declines remain most pronounced in Austin, while weakness has also broadened across Dallas, Houston, and San Antonio.
The Texas Real Estate Research Center, which publishes the official Texas Housing Insight report, notes that the increase in inventory appears to be driven less by a surge in new seller participation and more by homes taking longer to sell. In April, sold homes spent an average of 70 days on the market, down from 79 days in March but still above 2024 and 2025. Sellers are cutting prices to move inventory: median seller price cuts were $12,500, or 3.6 percent of the initial listing price.
Sharply higher energy prices, cost-push inflationary effects on consumer goods and services, and rising mortgage rates shaped the 2026 spring season, according to the Center’s May report. Early indications suggested these pressures were already slowing buyer activity and contributing to more hesitant purchasing behavior, with April’s pending home-sales index indicating slower buyer-contract-pending activity than typically recorded.
Resale home sales have shown more resilience in some markets. Houston’s single-family home sales rose 3.5 percent year-over-year in June, with 8,820 homes sold compared to 8,525 in June 2025, and pending sales increased 12.3 percent. North Texas (Dallas-Fort Worth) recorded 8,961 single-family transactions in June, a 7 percent increase compared to June 2025, with dollar volume climbing 8 percent to nearly $4.8 billion. But even in those stronger markets, median sales prices remained unchanged or increased only modestly, indicating the market is transitioning toward more balanced conditions.
What’s driving the shift
Mortgage rates: Mid-6% range through spring 2026, keeping monthly payments high. Property taxes & insurance: Rising costs in Texas, especially insurance, add hundreds per month to ownership expenses. Inventory buildup: Many new homes are still under construction or not yet started, meaning supply pressure will persist for months. Price cuts: Sellers offering median discounts of $12,500 (3.6%) to attract buyers. Days on market: Homes sitting longer, giving buyers more time to compare and negotiate.
For buyers
What this market means for you
More inventory, longer market times, and motivated sellers create the best negotiating environment Texas buyers have seen in years.
If you’re shopping for a new home in Texas right now, you have leverage. The Texas housing market in 2026 is a buyer’s market in ways it has not been since before the pandemic, with inventory almost doubled from the levels that defined the frenzied 2021-2022 era and homes sitting longer. That doesn’t mean every home is a deal, but it does mean you can take your time, compare options, and negotiate on price, closing costs, and contingencies.
New construction offers particular opportunities. Builders sitting on rising inventory—especially spec homes that are complete or nearly complete—are often willing to offer incentives: rate buydowns, closing cost credits, upgrades, or price reductions. Ask about all of these. A 1-point rate buydown that drops your rate from 6.5% to 5.5% can save you hundreds per month and tens of thousands over the life of the loan.
Focus on total monthly cost, not just the purchase price. In Texas, property taxes and homeowners insurance can add $800 to $1,500 or more per month depending on location and home value. Get quotes early. Check the Texas home buying guide for county-by-county tax rates and insurance considerations. If you’re a first-time buyer, explore down payment assistance programs and first-time buyer programs that can reduce upfront costs.
Be ready to move when you find the right home. Pending sales in Houston increased 12.3 percent in June, and North Texas saw a 7 percent increase in closed sales, showing that well-priced homes in good condition are still selling. Get pre-approved for a mortgage, not just pre-qualified. Understand your true affordability including all costs. And work with a buyer’s agent who knows the local market and can identify which sellers are motivated.
For buyers with credit challenges, this slower market gives you time to improve your score before applying. Every 20-point increase can lower your rate. For buyers with little or no money down, ask lenders about USDA loans (for eligible rural and suburban areas), VA loans (for veterans and active military), and conventional 97% LTV loans. Texas also has state and local programs that can help with down payments and closing costs.
For sellers
Pricing and positioning matter more than ever
Homes that feel overpriced are sitting, while well-positioned properties are still moving.
Price cuts are widespread, and sellers who are still anchored to peak-era valuations are finding out the hard way that the market has moved on. The current Central Texas housing market rewards homes that feel well-positioned and punishes homes that feel overpriced. That means your list price on day one is critical.
Get a comparative market analysis from an experienced agent who will tell you the truth, not what you want to hear. Look at what’s sold in the last 30 to 60 days, not what’s listed. Adjust for condition, location, and current market velocity. If comparable homes are sitting for 60+ days or getting price cuts, you need to price below them, not match them.
Presentation matters. Buyers have options, so they’re selective. Professional photos, staging, and addressing deferred maintenance before listing can be the difference between selling in 30 days versus 90. In a market where the average days on market is 70 days, every week your home sits costs you in carrying costs and makes buyers wonder what’s wrong with it.
Be ready to negotiate. Buyers will ask for concessions—closing cost credits, repairs, rate buydowns. Decide in advance what you’re willing to give and what your true bottom line is. The best offer isn’t always the highest price; it’s the one with the fewest contingencies and the most qualified buyer. Review our negotiating guide to understand what buyers are thinking and how to respond strategically.
Looking ahead
What to expect for the rest of 2026
The second half of the year will likely bring continued inventory pressure, modest price softness, and a market that favors prepared buyers.
The Texas Real Estate Research Center’s 2026 forecast projects total single-family home sales rising 2.5 percent to approximately 349,000 units, with a year-end median price of around $334,000, a 1.3 percent gain from 2025. But the current mid-year picture shows the market tracking slightly below those numbers on pricing.
The Texas housing market is entering the peak buying and selling season with pricing increasingly adjusting to accommodate buyer demand, further shifting balance toward buyers, with inventory expanding, sellers remaining cautious, and home prices continuing to weaken, while mortgage rates are expected to remain in the mid-6 percent range. Unless demand improves materially or rates fall significantly, expect the rest of the spring and summer to remain a buyer’s market.
That does not mean Texas is in distress—the fundamentals that drove a decade of population growth and business relocation are still intact, jobs are being created, and people are still moving to Texas; the correction underway is a normalization, not a collapse. Texas continues to add jobs and residents. The long-term outlook remains positive. But the short-term market is adjusting from the extremes of 2021-2022 to something more sustainable.
For builders, the question is how quickly they can adjust production to match demand. Texas posted 7,071 new residential construction permits in June 2026, representing more than $2.3 billion in total construction value, showing builders are still active. But if sales continue to lag inventory growth, expect builders to slow new starts and focus on moving existing spec inventory through incentives and price adjustments.
The wild card remains mortgage rates. If rates drop meaningfully—say, into the 5% range—buyer demand could surge quickly, absorbing inventory and stabilizing prices. If rates stay elevated or rise, the market will continue to favor buyers through the fall and winter. Monitor rates weekly, stay in touch with your lender, and be ready to act when conditions align with your goals.
Quick answers
Texas new home sales: common questions
Are Texas home prices falling in 2026?
Yes, in many markets. Statewide, home prices have declined year-over-year for 11 consecutive months through April 2026, with declines averaging 0.5 to 0.7 percent. Austin has seen the steepest drops, while other metros show more modest softness. Sellers are cutting prices by a median of $12,500 (3.6%) to attract buyers. This is a normalization, not a crash—prices are adjusting from the 2021-2022 peak to more sustainable levels.
Is now a good time to buy a home in Texas?
For buyers, yes—it’s the best market since before the pandemic. Inventory has nearly doubled from 2021-2022 levels, homes are sitting longer, and sellers are negotiating on price and concessions. Mortgage rates in the mid-6% range are still high, but builders and sellers are offering incentives like rate buydowns and closing cost credits. Focus on total monthly cost, get pre-approved, and be ready to move on well-priced homes.
Why is new home inventory so high in Texas?
Builders ramped up construction in 2023-2024 expecting strong demand, but affordability pressures—high mortgage rates, rising property taxes, and insurance costs—have kept buyers cautious. Homes are taking longer to sell, so inventory is piling up. Much of the new home inventory is still under construction or not yet started, meaning supply pressure will continue for months as those homes are completed.
Which Texas cities have the most inventory?
Houston leads with the highest number of active new home listings, followed by Dallas-Fort Worth. San Antonio saw the largest year-over-year inventory increase at 12.6 percent, followed by Houston at 7 percent and Austin at 3.2 percent. All four major metros have significantly more inventory than they did during the 2021-2022 seller’s market.
What are builders doing to move inventory?
Builders with rising spec inventory are offering incentives: permanent or temporary rate buydowns (reducing your mortgage rate by 1-2 points), closing cost credits ($5,000-$15,000 or more), free upgrades (appliances, flooring, landscaping), and in some cases, outright price reductions. Ask every builder about all available incentives—they may not advertise them but will negotiate to move completed or nearly completed homes.
Will Texas home prices keep falling?
The Texas Real Estate Research Center forecasts a modest 1.3% gain in median prices by year-end 2026, but the market is currently tracking below that projection. Continued inventory pressure and mid-6% mortgage rates suggest prices will remain soft through the summer and fall unless rates drop significantly. This is a buyer’s market, and sellers will need to price competitively and offer concessions to attract offers.