Can You Actually Afford a Home in Austin Right Now? Let's Do the Math

Every week someone tells me "I'd love to buy in Austin but I could never afford it."

Then we run their numbers and they realize they could have bought two years ago.

Here's what buying in Austin (and Central Texas generally) actually looks like in 2026 — broken down by income level. No fluff, real numbers.

The Market Baseline

As of April 2026:

• Austin metro median home price: ~$525K
• Kyle / Buda / Hays County median: ~$365K
• Round Rock / Pflugerville / NW Williamson: ~$450K
• Typical conventional rate (30-year fixed): ~6.75-7.25% depending on credit

Property taxes in Travis County run ~1.9%. Insurance is running ~$1,800/year for a typical home.

At $65K Household Income

You've got roughly $500K in maximum approved purchase power using our DPA-stacked programs. Reality is more like $275-320K if you want payments that don't stretch you.

What $300K buys you:

• Kyle, Buda, New Braunfels, northern San Marcos — yes
• Round Rock, Cedar Park — older/smaller homes, yes
• Austin city limits — townhouse or condo, maybe

Monthly payment estimate (300K home, 3.5% down, FHA + TSAHC stack):

• Principal + Interest: ~$1,930
• Taxes + Insurance: ~$625
• MIP (FHA): ~$220
• Total PITI: ~$2,775/month

Compare that to renting a 2BR apartment in Austin, which runs $2,000-2,400. You're paying $400-800 more per month but building equity every month instead of burning it.

At $90K Household Income

You're looking at $450-500K of practical purchase power. This is probably the most common income range for first-time buyers I work with.

What $450K buys you:

• Nice 3-4BR in Kyle, Buda, Round Rock, Cedar Park
• Entry-level in South Austin or East Austin
• Real options in Pflugerville, Leander

Monthly payment estimate (450K home, 5% down, conventional + DPA):

• Principal + Interest: ~$2,900
• Taxes + Insurance: ~$900
• PMI: ~$175
• Total PITI: ~$3,975/month

Rent for an equivalent house in these areas is $2,800-3,400. You're paying $500-1,200 more per month to own, but you're building $700-900 of equity per month from Day 1, and that number grows over time as the loan amortizes.

At $140K Household Income

Now you're in the $650-750K purchase range comfortably. This is where Austin proper becomes realistic.

What $700K buys you:

• Central Austin neighborhoods (Allandale, Brentwood, Zilker-adjacent)
• Premium areas in Round Rock / Cedar Park
• Large homes in Kyle, Dripping Springs

Monthly payment estimate (700K home, 10% down, conventional):

• Principal + Interest: ~$4,450
• Taxes + Insurance: ~$1,300
• PMI: ~$130
• Total PITI: ~$5,880/month

At this income level, buying is usually mathematically better than renting within 2-3 years.

The Hidden Moves

Here's what nobody tells first-time Austin buyers:

1. Homestead exemption kicks in the first year. Once you establish Texas residency and apply (free, through TCAD), your property tax drops noticeably. My clients typically see a $150-200/month reduction starting Year 2.

2. Rates aren't staying at 7%. I'm not predicting when, but the 30-year average conventional rate is closer to 6%. When rates drop, you can refinance. You can't go back and buy at today's prices at tomorrow's rates.

3. Inventory is seasonal. Spring (March-May) is peak buyer competition. Fall (Sept-Nov) has far less. Same neighborhoods, less bidding, more negotiating leverage.

4. Sellers will often cover some closing costs. In a balanced market (which we're in now), asking the seller to pay 2% of closing costs is normal. That's real money — often $10-15K — that doesn't come out of your pocket.

The Rent vs Buy Decision Framework

Don't overthink this. Four questions:

1. Can you save 3-5% of a home price in the next 12 months? If yes, you're closer than you think — between DPA and seller concessions, that's often enough.
2. Will you stay in the area for at least 3 years? If yes, buying wins mathematically almost every time. If no, keep renting.
3. Is your job stable? Not "will you have this exact job forever" — just "if you lost this one, could you find similar in the area?" Austin's market is strong, the answer is usually yes.
4. Do you have 3 months of emergency savings BEYOND the down payment? This matters more than the down payment. Buying stretches finances — you want a buffer.

If you answered yes to 3+, book a call. We'll run real numbers for your specific situation and tell you honestly whether now is the time.

And if it's not, we'll tell you that too. Renting isn't failure — sometimes it's the smart call. But you deserve to know the actual math, not a guess.