Understanding the Freddie Mac House Price Index (FMHPI®) and Its Impact on the Austin Housing Market – October 2025 Update
Scroll down to view the full Freddie Mac House Price Index report for October 2025.
The Freddie Mac House Price Index (FMHPI®) remains one of the most accurate and standardized measures for tracking residential price trends across the United States. Updated monthly, the index reflects movements in single-family home values derived from verified, conventional mortgage transactions purchased or securitized by Freddie Mac.
Because FMHPI is based on recorded mortgage data rather than MLS listings or public portal estimates, it avoids distortions caused by incentives, off-market sales, or atypical financing. For analysts, policymakers, and real estate professionals, it provides the most reliable snapshot of real home value performance and long-term housing affordability.
Unlike regional MLS datasets, FMHPI measures cumulative appreciation from fixed baselines such as January 2020 or January 2021, offering both short-term movement (month-to-month and year-over-year) and historical context across national, state, and metro levels.
Austin’s Position in October 2025
The latest FMHPI release (posted October 31, 2025, covering data through September 2025) shows that Austin’s market continues to trail national recovery trends despite some signs of stabilization. Peak-to-current decline: Austin home prices remain 16.3% below the May 2022 peak, one of the steepest corrections among major U.S. metros. Year-over-year: Down –2.5%, indicating continued mild erosion in real values. Month-over-month: Roughly flat, with a –0.2% change, suggesting that the rate of decline is slowing.
By comparison, the national FMHPI continues to show a modest rebound, with home prices +5.0% year-over-year and a +0.8% monthly gain. The contrast highlights how the Austin market remains under pressure while most metros are moving higher.
Even with these declines, Austin’s long-term appreciation remains historically strong: prices are +38% above January 2020 and +16% above January 2021 levels. The difference is that other major metros have already recovered their 2022 peaks — markets like Chicago, New York, and Boston are now setting new highs, while Austin remains one of the few major metros still in an extended normalization phase.
Long-Term Perspective
Between 2020 and 2022, Austin’s home prices surged more than 70%, one of the sharpest increases in the country, fueled by pandemic migration, tech-sector employment expansion, and an extreme supply-demand imbalance. Once mortgage rates reset above 7%, affordability collapsed and values began retracing rapidly toward long-term equilibrium.
The Team Price National Market Index (HPI/CPI) reinforces this broader trend: inflation-adjusted U.S. home prices are –1.4% year-over-year but still 27.6% above their long-term historical average. In that context, Austin’s deeper decline reflects an overcorrection relative to the national mean — a recalibration from extreme pandemic-era valuations rather than a structural market failure.
Implications for Buyers and Sellers
For buyers, Austin remains one of the most opportunity-rich markets in the country. Values are roughly 17% below the 2022 peak, giving purchasers meaningful price relief relative to the frenzy years. While mortgage rates remain a constraint, this correction has restored some negotiating leverage, and the spread between list and sold prices continues to favor buyers willing to act decisively.
For sellers, the takeaway is equally important: anchoring expectations to 2022 valuations is no longer realistic. The gap between Austin’s local decline and the national appreciation rate illustrates that sellers here face steeper competition. Correct pricing, realistic negotiation strategy, and a clear understanding of local inventory levels are now non-negotiables for success.
Looking Ahead
FMHPI is not designed to forecast the future, but it remains a critical benchmark for understanding where we stand within the broader housing cycle. When paired with local indicators such as Active Listings, Pending Activity, and the Team Price Market Flow Score, it provides a comprehensive picture of market health.
As of October 2025, Austin’s housing market remains in a late-stage correction phase — down from the peak but approaching a likely stabilization point. The slowdown in monthly declines and the steadying national trend suggest that Austin may be nearing its price floor.
Long-term fundamentals — population inflow, job diversity, and economic expansion — remain intact. Once affordability normalizes and rate volatility subsides, demand should reassert itself. Until then, the data is clear: Austin remains one of the most corrected but also one of the most strategically positioned markets for buyers focused on long-term value capture.
