Inventory & Market Ratios: Signs of Saturation
We are currently sitting at 17,910 active residential listings, just 166 shy of the recent peak set on June 27. That means we’re still at one of the highest inventory points in over a decade. Meanwhile, 58.9% of those active listings have seen a price drop—confirming that price reductions are no longer an exception, but the norm. Withdrawn listings hit 1,033, forecasted to exceed 1,239 before the end of the month—an all-time high for July in 21 years.
The new listing-to-pending ratio sits at 0.58, far below the neutral 1.0 mark. Historically, that ratio has only been this low during major market events like the Great Financial Crisis, COVID lockdowns, and dot-com bust. Simply put: more inventory is piling up than buyers can absorb.
Pending Sales: A Slightly Brighter Spot
Although pendings remain down year-over-year, we’re seeing a slight uptick in activity since the beginning of July. We’re now just 0.5% under last year’s pending count for this time period. That’s a reversal from the trend we saw last year where pendings consistently declined through summer. If that pattern holds, we may close the month with pending numbers in the positive year-over-year.
What’s driving this? Builders. New construction continues to outperform resale listings, with an activity index of 28.39% compared to just 16.71% for resale homes. The builder incentives are working, and that means agents need to be on top of new build inventory for buyers who want value.
Pricing Trends: The Market Pressures Continue
We are now experiencing month-over-month and year-over-year declines in median sold price. The median sits at $443,763, which is $106,000 below peak pricing—a nearly 20% decline. Even the sold-to-list price ratio is down to 97.13%, the lowest July ratio since 2011. Only 12.1% of homes sold over asking, another 13-year low.
This pressure is also reflected in the sold-to-original-list price, now at 93.18%, showing that sellers are often making multiple price adjustments before accepting an offer—and then negotiating further. This widening gap indicates strong buyer leverage.
Affordability & Forecasting: Are We Near Bottom?
Our median sold-to-income ratio sits at 4.09, continuing to trend back toward the long-term average of 3.72. While still above average, this is a meaningful correction from the high of 5.75 in 2022. If the market overcorrects—which it often does—we could see prices drop another 5–15%. That could push us into a more sustainable affordability range.
Even in this environment, some submarkets remain affordable: Jarrell, Manor, and 78725 are all in the low-30% income-to-mortgage range. That affordability metric matters now more than ever, as leasing inventory is also at record highs (7,310 units)—indicating many sellers are choosing to rent rather than sell, contributing to downward pressure on both the lease and resale sides.
Rates & Economic Outlook: This Week is Crucial
Mortgage rates crept up to 6.875% last week, driven by shifts in the bond market. This week, however, could dramatically change that. With multiple economic indicators scheduled—PCE inflation data, consumer confidence, job openings, unemployment, and more—we may see rates swing in either direction. If inflation surprises to the downside, we could see rates dip back to the 6.25% range. If not, we could see 7.125% by the end of the week.
Final Thought: It’s a New Market for Everyone
With the current environment—record-high inventory, softening prices, and buyer-friendly terms—every agent is learning to sell in a new way. Whether you've been in the industry for 5 days or 15 years, no one has seen a market quite like this since 1987–1989. And while change is uncomfortable, it also brings opportunity. The agents who stay informed and adapt quickly will lead the next phase of the market.
