Disclaimer: The February 2026 figures are based on more complete data and have been revised from their initial release.
The economic impact from geopolitical instability is reshaping the trajectory of the spring housing market. Before the recent geopolitical conflicts and escalations, expectations were building for a more active and balanced housing market this spring. Even though affordability remained a persistent headwind for demand, several indicators pointed to improving conditions: mortgage rates had been trending down, easing some of the affordability strain and drawing buyers back into the market; sellers were returning, pushing inventory higher; and consumer sentiment was improving amid moderating inflation and a solid labor market.
Although February’s statewide sales came in below last year’s levels, the decline in mortgage rates through January and February suggested that more sales would flow into March closings, consistent with the rise in February pending sales. Fresh listings were on the rise. While not outpacing last year’s pace, new-listing activity was running moderately ahead of last year through the first two months of 2026. With more sellers returning to the market, inventory has been replenishing quickly, already exceeding last year’s levels. Although inventory growth was not accelerating as sharply as it did last year, it was on track to reach a new spring-season high while also putting additional pricing pressure on sellers. For prospective buyers, the supply conditions were again shifting in their favor.
That was the backdrop before the Iran war broke out Feb. 28. The developing conflict materially altered the housing market’s near-term trajectory. Rising mortgage rates, weakening consumer sentiment, and signs of inflation re-acceleration under higher energy prices are now weighing on buyer demand just as the market typically gains momentum and sets the stage for the full year.
For now, with no clear near-term resolution to the Iran conflict in sight, the early spring market is likely to be defined by slower buyer demand as the paths of mortgage rates and inflation shifts. Many buyers may choose to wait at the start of the season, while at the same time, sellers still aim to capitalize on the seasonal upswing. That said, this dynamic will also create opportunities for buyers who can navigate higher borrowing costs and for sellers who are willing to price more strategically under heightened uncertainty.
February Saw Another Year-Over-Year Sales Decline
Notes: The sales numbers reflect actual sales, not the seasonally adjusted annual rate.
Source: Texas REALTORS and National Association of REALTORS data (accessed at Haver Analytics)
- Statewide, February recorded 22,596 closed sales, down 2.2 percent YoY and extending January’s 3.1 percent decline. Regionally, sales fell 6.1 percent in DFW, 4.2 percent in San Antonio, and 3.5 percent in Houston, while Austin posted a 7.4 percent increase (see Table 3).
- Year to date, sales were down 2.6 percent statewide. Regionally, YTD sales declined 7.6 percent in San Antonio, 6.1 percent in DFW, 3.7 percent in Houston, while Austin recorded a small 0.4 percent gain (see Table 3).
- Statewide median home prices reached $325,000, up slightly from January’s $321,000 and in line with typical seasonal gains, though the January-to-February increase has become much more muted in today’s higher-rate environment. Year over year (YoY), prices slipped 1 percent, extending January’s 1.5 percent decline.
- Nationally, seasonally unadjusted home sales posted a modest 0.8 percent YoY gain. Sales fell again in the Northeast (3.8 percent) and Midwest (1.8 percent), while the South recorded a 3.2 percent increase and the West held steady.
- In February, the national median price for existing single-family homes edged up to $402,300, a 0.3 percent increase YoY.
Monthly Market Snapshot: February Sales and Inventory Trends
Notes: The turnover rate is calculated as pending sales divided by inventory, where inventory is the average of month-beginning and month-end inventory
Source: Texas Real Estate Research Center analysis of Data Relevance Project and Texas REALTORS data
- In February, homes spent an average of 82 days on the market, up from 74 days in 2025 and 67 days in 2024. This is the first time since February 2013 that the average has exceeded 80 days.
- February also marks a new seasonal low in housing turnover, with one in five active listings receiving a pending commitment, unchanged from last year.
- Median seller price cuts were $16,900, or 4.9 percent off the initial listing price, up from $14,900 (4.2 percent) a year ago.
- In February, active inventory rose to a 4.8-month supply, reflecting a normal seasonal buildup heading into the spring market. YoY, inventory remained higher than both last year and the year before.
- Meanwhile, days-on-market (DOM) for unsold inventory averaged 99 days (just over three months). This was higher than both last year and the year before.
Seller Activity Continues Its Upward Trend
Source: Texas Real Estate Research Center analysis of Data Relevance Project, Texas REALTORS data
- Sellers are returning to the market, and fresh listings continue to rise. In February, roughly 47,500 new listings came online, a 1.5 percent MoM increase.
- YoY, new listings were 3.1 percent higher than a year ago.
- While not outpacing last year’s pace, new-listing activity is running 1.9 percent ahead of last year through the first two months of 2026.
- A continued increase in fresh listings is expected as the spring market officially begins in March, with many sellers aiming to time the period of strongest buyer traffic.
Inventory On A Seasonal Upswing, Exceeding Last Year’s Levels
Source: Texas Real Estate Research Center analysis of Data Relevance Project and Texas REALTORS data
- With more sellers returning to the market, inventory has been replenishing quickly and even exceeds last year’s levels.
- In February, active inventory rose 2.8 percent MoM, matching January’s pace.
- By the end of February, active listings totaled roughly 134,400, about 10 percent higher YoY.
- Although inventory growth is not accelerating as sharply as it did last year, it remains on track to reach a new record high for the spring market.
- Rising inventory across both new and existing listings is likely to intensify downward pressure on prices in the near term, especially as mortgage rate volatility, inflation setbacks, and weakening consumer confidence have worsened since March while uncertainty remains elevated.
Texas Home Prices Slide For The Ninth Month
Note: The year-over-year change in the price index is calculated as a three-month moving average ending in the report month.
Source: Texas Real Estate Research Center analysis of Data Relevance Project, Texas REALTORS data
- Home prices continued to soften through February, marking the ninth consecutive month of YoY declines.
- The pace of declines shows little signs of easing. Since September, annual price drops have persistently held in the 0.6-0.7 percent range, and preliminary March data points to the same trend.
- Regionally, prices remain weakest in the Austin and San Antonio markets, where annual declines have persistently hovered in the 2-3 percent range and have occasionally accelerated. In February, the median price cut among closed sales was $30,000 in Austin and $20,000 in San Antonio, representing 6.7 and 6.2 percent off the original listing price, respectively.
- The Houston market continues to face pricing pressures, with annual declines gradually accelerating—from 0.9 percent in January to 1.6 percent in February. The median price cut was $19,500, or 5.3 percent off the original listing price.
- Price softening in the DFW area persisted through February, with Fort Worth-Arlington even showing signs of rising pricing pressure.
Local Housing Market Indicators
Source: Texas Real Estate Research Center analysis of Data Relevance Project, Texas REALTORS data
Source: Texas Real Estate Research Center analysis of Data Relevance Project and Texas REALTORS data
Notes: Permit value is builder estimated construction costs of the residential structure, not including land acquisition costs.
Source: Survey of New Construction of U.S. Census Bureau
Source: Texas Housing Insight | April 2026 | Texas Real Estate Research Center (written by Yanling Mayer)
