Texas › Cost of living FAQ
Texas cost of living: straight answers to the questions people ask.
Every number sourced. Checked this month.
Short answers to the questions we hear most from people thinking about a move to Texas, each with the current number, where it comes from and a link to the page with the full detail. The short version: Texas is a little cheaper than the U.S. overall and much cheaper than California, but property tax and insurance take back part of the savings, and it matters a lot which city you pick.
Numbers last checked October 31, 2026Overall cost
Is Texas cheap to live in?
A bit cheaper than average, not dirt cheap. BEA puts Texas prices at 97.1 against a U.S. average of 100, about 3% below the nation (2024 data, released Feb 2026; 2025 data is due Dec 10, 2026). The spread inside the state is wide, from 103.1 in Dallas-Fort Worth to 85.9 in McAllen. See Compare Texas cities.
Is Texas cheaper than California?
Yes, by a lot for most households. California’s price level is 110.7, the highest of any state, against Texas’s 97.1, and its top income tax rate is 13.3% where Texas has none. Regular gas averaged $5.89 in California and $3.63 in Texas in the week of Oct 26, 2026. The catch is property tax: the Tax Foundation’s statewide effective rate is 1.40% in Texas against 0.70% in California. Full side-by-side on Texas vs. California.
What is the cheapest city in Texas?
Of the cities we cover, McAllen. Its metro price level is 85.9, the lowest of the 12 cities on this site, and MIT’s living wage for a single adult there is $38,284 a year, also the lowest. Across every Texas metro BEA measures, Texarkana is lower still at 84.0. El Paso is the cheapest of the big six, at 89.9. See McAllen and El Paso.
What is the most expensive city in Texas?
Dallas-Fort Worth has the highest overall prices: 103.1, the only Texas metro above the U.S. average. Austin is lower overall, at 98.1, but has the priciest homes of the big cities, with a City of Austin median of $560,000 in August 2026. See Dallas and Austin.
How much money do I need to live in Texas?
MIT’s living wage for one adult with no kids is $21.77 an hour, or $45,290 a year before taxes, statewide (updated Feb 15, 2026). Across the metros we cover it runs from $38,284 in McAllen to $50,205 in Dallas-Fort Worth. Two working parents with two kids need $101,697 combined. That is a bare-bones budget with no savings. See How much to live in Texas.
What salary do I need to live in Austin?
About $49,000 for a single adult on a basic budget: MIT’s figure is $23.71 an hour, or $49,322 a year. By the 30% rule, the median 1-bedroom of $1,172 (Oct 2026 data) takes an income of $46,880, our math. Austin pays well to match: the average job pays $35.85 an hour, against $33.54 nationally (May 2025). See Austin and Texas salaries.
Taxes
Does Texas have a state income tax?
No. The state constitution bans a personal income tax (Art. 8, Sec. 24-a), a rule 74% of voters approved in 2019. In November 2025 voters also banned taxes on capital gains and inheritances (National Law Review). No Texas city has an income tax either, but you still owe federal income tax. See Texas taxes.
What is the sales tax in Texas?
The state rate is 6.25%, and cities, counties, transit and special districts can add up to 2%, for a maximum of 8.25%. Every city this site covers charges the full 8.25%. For comparison, Los Angeles County is at 10.25%. City-by-city breakdown on Texas sales tax.
Do I pay sales tax on groceries in Texas?
Not on food itself. Grocery staples, baby food, diapers and over-the-counter medicine with a Drug Facts label are exempt (Comptroller Pub. 96-280). Candy, soft drinks, hot food, paper goods, cleaning supplies and pet food are taxed, so a typical cart is partly taxable. See Texas sales tax and Texas groceries.
Why are Texas property taxes so high?
Because, with no income tax, property tax pays for most local schools and services. There is no state property tax; instead, a typical big-city bill stacks five to eight rates (school district, county, city, hospital, college, sometimes a MUD) that add up to roughly 2% to 2.6% of taxable value before exemptions. After exemptions, WalletHub puts the statewide effective rate at 1.49%, with a median bill of $4,232 (reported Feb 17, 2026). Several 2026 rates also hinge on Nov 3, 2026 elections. See Texas property taxes.
How much is the homestead exemption in Texas?
For school taxes, $140,000 off your home’s taxable value, plus another $60,000 if you are 65 or older or disabled. Voters raised both on Nov 4, 2025. Your homestead’s taxable value also can’t rise more than 10% a year, and filing is free, usually by April 30. City, county and hospital taxes still apply to the full value unless they offer their own exemption. See Texas property taxes.
Housing
How much is rent in Texas?
Lower than a year ago. Apartment List puts the statewide change at −1.5% year over year (Oct 2026 data). Median 1-bedrooms run from $942 in El Paso and $953 in San Antonio to $1,207 in Dallas. See Texas rent.
How much does a house cost in Texas?
The statewide median sale price was $333,628 in the third quarter of 2026, down 0.4% from a year earlier (Texas REALTORS). Prices are flat, but the 30-year mortgage rate was 7.24% in the week of Oct 29, 2026, and property tax plus insurance can add more than $800 a month. See Texas home prices.
Bills, insurance and cars
Is electricity cheaper in Texas?
Per kilowatt-hour, yes: Texas homes averaged 15.41¢ against 17.65¢ for the U.S. in April 2026 (Energy Ogre’s summary of EIA data). Summer air conditioning means Texans use a lot of it, though, so bills are not always low. In Houston, Dallas and Fort Worth you shop for a plan; in Austin, San Antonio and El Paso one city or regulated utility sets the rate. See Texas electricity.
How much is car insurance in Texas?
Experian puts the average at $2,329 a year, with full coverage at $2,897 and a minimum-only policy at $1,680 (Sep 2026 data). The state minimum is 30/60/25 liability. Rates are easing: TDI says cuts filed since Jul 1, 2026 reach 4.4 million policyholders. See Texas insurance.
How much is homeowners insurance in Texas?
The average Texas premium was $3,489 in 2025 (preliminary), up from $1,987 in 2020, according to TDI. Most rate filings since July 2026 have been decreases. On the coast, windstorm and flood often mean extra policies. See Texas insurance.
What does it cost to register a car when I move to Texas?
Base registration is $51.75 a year including the TexasSure fee, plus county fees and a $7.50 inspection replacement fee. You also pay a one-time $90 new-resident tax and have 30 days after moving to register. Safety inspections ended for personal cars in 2025, but emissions tests continue in 17 counties, and Bexar County joins on Nov 1, 2026. See Texas vehicle costs.
What is the minimum wage in Texas?
It is $7.25 an hour, the federal rate, unchanged since Jul 24, 2009. State law (Labor Code §62.0515) bars cities and counties from setting a higher one, so it is the same in Austin as in Amarillo. That is about a third of MIT’s statewide living wage. See Texas salaries.
Out-of-date numbers you’ll still find online
Voters raised it on Nov 4, 2025, and the 65+ add-on is now $60,000.
Personal vehicles have not needed one since Jan 1, 2025. Emissions tests remain in the big metros.
$1,987 was the 2020 average. TDI’s preliminary 2025 figure is about 75% higher.
MIT updates yearly; the current Texas page is marked Feb 15, 2026.
How we check
Every answer reuses a figure from the linked page on this site, with the same source. Price levels will change when BEA publishes 2025 data on Dec 10, 2026, and some property tax rates depend on the Nov 3, 2026 elections; we will update both. Read the full methodology.