The Lone Star State is one of the most rapidly growing states in the country. Its population increased by more than 4 million people between 2010 and 2020. While there are many factors driving this growth — job opportunities, weather and sizable, sophisticated cities — the Texan cost of living is also one of the top draws for transplants.

As housing prices have been soaring across the U.S. in recent years, the cost of a home in Texas continues to be 15 percent lower than the national average. And that’s not the only living expense that’s cheaper in Texas. Food and transportation costs are both about 9 percent lower than the national average, and healthcare is 5 percent lower. Collectively, the cost of living in Texas is 8 percent lower than the national average.

Best Places to Live
While it conjures up images of prairies and oil fields, Texas is actually home to some appealing cities. Among the leading choices is the state capital of Austin, which is known for its quirky culture, university, tech companies and vibrant music scene. San Antonio and Arlington also rank highly thanks to their affordability.

What’s the average cost of living in Texas?

Like anyplace else, the cost of living in Texas varies depending on which section of the state you are talking about. The most expensive city is Plano: Located north of Dallas, the cost of living is 20 percent higher than the rest of the state and 11 percent higher than the rest of the country. The cost of living in Fort Worth and Houston, on the other hand, is 4 percent and 5 percent less expensive respectively than the national average.

Housing costs: owning vs renting

Whether you’re buying or renting in Texas, you’ll find it more budget-friendly than many other places in the country. The cost associated with both is about 15 percent cheaper than the national average.

Still, Texas is not entirely immune to the forces that have been driving up real estate costs across the country. The median sales price of a home in the state increased 18.6 percent in the first quarter of 2022 over the same time a year earlier, putting the price around $325,000, according to the 2022-Q1 Texas Quarterly Housing Report released by Texas REALTORS, a professional membership organization.

Rental costs remain well lower than national averages. You can expect to spend an average of about $867 per month on a studio apartment in the state, compared to a national average of $949. A one-bedroom in Texas runs about $953 compared to $1,048 nationally.

Utility costs

Utility bills are one of the few areas where you will not save money by living in Texas. According to September 2022 data from EnergySage, the average monthly electricity bill in the state is $181, which amounts to about $2,172 annually. That’s a steep 12 percent higher than the national average.

Grocery costs

Food prices in Texas are generally quite affordable, according to Apartment List, an online marketplace for U.S. apartment listings. On average, you’ll spend about $3,177 a year on groceries, which amounts to about $264 per month. However, for larger families, the expense may be closer to $9,305 a year or $775 per month.


Cars are essential for most people in Texas unless you live in one of the state’s big cities, where public transportation may be available. Even with this being the case, transportation costs in Texas remain about 9 percent lower than the national average. But what does that amount to exactly in terms of an annual expense?

According to MIT’s living wage calculator, an individual with no children spends about $5,509 annually on transportation in Texas. For an individual with one child that increases to $9,776 per year, and someone with two children can expect to spend $12,709 annually on transportation-related expenses.

The current average cost of a gallon of gas in Texas is about $3.28 for regular gas, which makes it one of the least expensive states in the nation. Car insurance on the other hand, is slightly more expensive in Texas than many other states. You can expect to spend about $1875 annually, on average.

Taxes: income, sales and property

The good news on the tax front is Texas does not charge residents a state income tax — one of just a few states in the country not to inflict one.

On the other hand, property taxes in Texas are far steeper than the majority of the country. The property tax rate is 1.6 percent, making it the sixth most expensive of the 50 states, according to the Tax Foundation. However, the state tax code allows taxpayers 65 years of age or older to defer their property taxes until their estates are settled after death. In May 2022, a measure passed to essentially cut school district property taxes for homeowners who are 65 and older or disabled.

Texas job market and unemployment rate

By many accounts, the job market throughout Texas is booming. This is due in large part to the energy sector presence in the state, which includes many oil and gas companies. Other growing industries providing a fair share of jobs include manufacturing, technology and services.

According to the Texas Workforce Commission, the state has been consistently setting records for job growth. The unemployment rate was 4 percent as of July 2022. The agency also reported nine consecutive months of record job growth. Since just January 2022, the Texas economy has added more than 406,000 jobs.

Ready to move to Texas?

Whenever you’re considering a move to a new state, it’s a good idea to spend some time there first, exploring the various cities and even individual neighborhoods. From big cities like Dallas and Houston to more rural regions in Texas Hill Country, there are many different ways of life and styles of living.

Finding a local real estate agent who knows that part of the state well and can help you navigate the options is a good first step.


  • Texas is one of the more affordable states in the country. Compared to the national average, your living expenses will be 7 percent cheaper — though the exact figure will vary based on where you choose to live in the state. In some big cities like Dallas the cost of living is actually 6 percent higher than the national average. But in Houston, you’ll find a cost of living 5 percent lower than the national average.
  • The median home value in Texas stands at $187,200, according to 2020 U.S. Census data.
  • The amount you need to live comfortably in Texas varies based on which part of the state you plan to call home and whether you intend to rent or buy. In general, your income should be at least three times the amount of your monthly mortgage or rent payment. If you’re a renter in Texas, where the average one-bedroom costs $953, your monthly income would need to be three times that to be comfortable, which is about $2,859.
    Looked at another way, individuals in Texas who have no children must earn at least $16.41 an hour to comfortably get by, according to MIT’s living wage calculator, which estimates how much individuals must earn to support themselves across the nation. If you have one child, the adequate living wage needed in Texas increases to $31.63 an hour. Someone with two children would need to earn $38.97 per hour.