Prices of homes are continuing to trend downward as inventory is on a steady uptick in Cedar Park and Leander, according to Austin Board of Realtors year-end report.

In 2022, the peak median price of homes in Leander and Cedar Park was $629,000, according to ABoR data. Home prices in both cities significantly dropped to $531,000 in December, which is a 15.6% decrease.

“December tells us a lot about how the market has shifted and started to rebalance as there was a sales price drop and a staggering increase in how long homes take to sell,” said Mark Sprague, state director of information capital for Independence Title, in the Jan. 18 press release.

There has also been a steady rise in the amount of available inventory on the market in Leander and Cedar Park since early 2022.

Last year, the lowest amount of inventory the cities experienced was 0.2 months, which was in January and February, according to ABoR data. It has been on a slow rise since then. In December, there was 1.9 months of inventory in Cedar Park and Leander.

Still, Sprague said, increasing construction costs, supply chain and labor issues could cause inventory to fall in the coming year.

“Even with the inventory gains made in 2022, our region still needs more housing. This need could be exacerbated as builders and developers continue to recover after overextending themselves nationally and increasing interest rates lessen people’s buying power,” he said. “We could see 15-20% less inventory in 2023 as builders scale back their housing starts.”

Affordability will still remain an issue in the year ahead, experts said, due to increasing interest rates, rising construction costs and expected lower levels of inventory in the near future.

ABoR President Ashley Jackson said now is the time to make changes to the region’s approach to housing.

“Communities across Central Texas must come together to meet the challenge of housing our rapidly growing population by collectively finding ways to increase the abundance and variety of housing,” she said. “If we work together, we can change the trajectory we’re on by crafting housing policies that address housing access, availability, and affordability and create a more inclusive housing market.”