Allen Markel, REALTOR® · Texas Premier Realty

Market Updates & Home Values

Are home prices dropping in houston?

Answered by Allen Markel, REALTOR®, Texas Premier Realty ·

Short answer

Houston home prices are not in freefall, but they are softening. In August 2026, the median price for existing single-family homes fell 2.9% year over year to $330,000, and the average price dipped 1.0% to $433,016. Inventory sits at 5.3 months, which is above the national figure of 4.6 months. The market is moving toward balance, not collapse. Where you land depends on what you are buying, where, and when.

What are Houston home prices actually doing right now?

The most recent data available comes from the August 2026 Houston housing market report. For existing single-family homes, the median price fell 2.9% year over year to $330,000, and the average price declined 1.0% to $433,016. Those are real declines, but they are measured in single digits, not double digits.

When you look at all single-family homes, including new construction sold through listing data, the picture shifts slightly. The single-family median price for the broader market came in at $330,000, down 1.5% from a year ago, while the average price across all single-family transactions actually rose 1.2% to $426,760. The difference between those two figures reflects the mix of homes that closed in August, including higher-priced new construction pulling the average up even as the median drifted down.

Townhomes and condominiums told a sharper story. The average price for that segment fell 1.5% to $245,692, and the median dropped 7.1% to $195,000. Inventory for townhomes and condos rose from 8.1 months in August 2025 to 8.8 months in August 2026, which means buyers in that segment have considerably more negotiating room than buyers of single-family homes.

These numbers are a snapshot of where the market stood in August 2026. They do not tell you where prices will be next month or next year.

Why are prices softening, and how does inventory play into it?

Inventory is the clearest driver of what is happening. Active listings in August 2026 reached 38,947 homes, up 0.5% from a year ago. Months of supply held at 5.3 months for single-family homes. For context, the national supply figure sat at 4.6 months at the same point in time. Houston is carrying more supply than the country as a whole, and more supply generally puts downward pressure on prices.

Sales volume is also down. Single-family home sales declined 11.5% year over year in August, landing at 7,100 closings for the month. Total property sales across all types fell 10.2%, with 8,362 units sold. Total dollar volume dropped 8.8% to $3.5 billion. Fewer buyers closing means sellers have less leverage, which is part of why prices are easing.

Homes are also sitting longer. The average days on market for single-family homes increased from 52 days in August 2025 to 54 days in August 2026. Two extra days may not sound like much, but it is a signal that buyers are taking more time, which is consistent with a market where they have more options and less urgency.

Pending sales totaled 7,939 in August, which shows that buyers are still active. The market has not stalled. It has slowed and rebalanced.

Is this a crash, or is it something else?

The word "dropping" can mean a lot of things. A 2.9% decline in the existing-home median price is a softening, not a collapse. To put it in a longer frame: single-family home sales in the past 12 months totaled 88,565 properties. In 2019, which was described as the last normal year before the pandemic, total single-family sales for the full year came to 86,999. Houston's transaction volume has actually held above its pre-pandemic baseline even as prices ease.

By comparison, U.S. single-family housing sales were down 20.1% compared to 2019 at the same point in time. Houston is outperforming the national picture on volume even while prices soften locally.

The price declines are not uniform across segments either. In August, sales in the $1 to $99,999 range increased 11.1%, with 110 transactions. Every other price band saw year-over-year declines in the number of closings: the $100,000 to $149,999 segment fell 4.8%, the $150,000 to $249,999 segment fell 11.3%, the $250,000 to $499,999 segment fell 13.7%, the $500,000 to $999,999 segment fell 16.5%, and the $1 million and above segment fell 2.1%. The steepest volume drops are in the middle and upper-middle price ranges, which is where inventory has built up the most.

What this tells you is that the market is not moving in one direction uniformly. The segment you are buying or selling in matters more than any single headline number.

What does this mean if you are buying or selling right now?

If you are a seller, the data says you are still selling into a market with real buyer activity. Pending sales of 7,939 in August show that buyers are writing contracts. But you are competing against 38,947 active listings, and buyers are spending an average of 54 days deciding. Pricing accurately from the start matters more now than it did two or three years ago, when low inventory let sellers set almost any number and wait.

If you are a buyer, 5.3 months of supply gives you more room to negotiate than you had during the pandemic years. You have more homes to choose from, more time to inspect, and in many cases more willingness from sellers to work on price or terms. That does not mean every home is a deal, and there is no signal that tells you when a market bottom has arrived until after it has passed. Waiting for a bottom is a strategy with its own risks.

The right time to buy or sell is when you are able, ready, and willing. Market conditions are one input into that decision, not the only one. Your timeline, your finances, and the specific property all carry weight.

Our listing data covers the Greater Houston area across Harris, Fort Bend, Montgomery, Waller, Grimes, and Austin counties, so we can show you what is happening in the specific zip code or community you care about, not just the metro-wide average. If you want to work through what the current numbers mean for your situation, talk to us to find the right option for your circumstances.

Common follow-up questions

Is the Houston housing market going to keep dropping?

There is no way to know for certain, and there is no guarantee of price direction in either direction. The August 2026 data shows softening prices and elevated inventory, but buyer activity remains present with 7,939 pending sales in a single month. What happens next depends on factors including mortgage rates, new construction activity, and broader economic conditions.

How does Houston's inventory compare to the rest of the country?

As of August 2026, Houston's single-family inventory stood at 5.3 months of supply, compared to a national figure of 4.6 months. More supply locally means buyers have more options and sellers face more competition than in many other markets.

Are townhomes and condos dropping more than single-family homes?

Yes, based on August 2026 data. The townhome and condo median price fell 7.1% year over year to $195,000, and inventory rose to 8.8 months of supply. That is a steeper decline and a higher inventory level than the single-family segment.

Does the price drop affect all price ranges equally?

No. In August 2026, the only segment that saw an increase in the number of closings was the under $100,000 range, up 11.1%. The steepest volume decline was in the $500,000 to $999,999 range, down 16.5%. The segment you are in shapes your experience of the market considerably.

How long are homes sitting on the market in Houston right now?

Single-family homes averaged 54 days on the market in August 2026, up from 52 days a year earlier. That two-day increase reflects a slower pace of decision-making by buyers who have more inventory to consider.

Sources

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Answers describe transactions and public data. They are not legal, tax or financial advice.