Buying your first home in Texas

The price looks easy — that's the trap

Texas's median home is about $302,000 — below the national median of $403,200. On paper the income needed (~$87,000) sits close to what a typical Texas household earns (~$68,000), so the purchase price itself is genuinely attainable for many buyers.

The catch is what comes after the price: Texas has no state income tax, and it makes up the difference through property tax and insurance — two of the largest and most commonly underestimated costs of owning here.

Property tax is the number to budget for

Texas property taxes are among the highest in the nation at 1.5–2.5%+ of home value annually. This is the single most commonly underestimated cost for first-time Texas buyers. On a $300,000 home, budget $4,500–$7,500/year in property taxes alone.

That's an annual cost, every year you own — not a one-time closing item. When you compare a Texas home to one in a lower-tax state, run the monthly figure withtax included, or you'll understate the true cost of ownership.

Insurance varies enormously by region

Texas averages about $3,000 a year — above the national average of $2,543 — but the average hides a huge spread. Texas homeowners insurance costs vary enormously by region — coastal/Gulf areas near Houston pay far more than inland areas. Budget carefully and research your specific ZIP code.

The main risks driving cost are hurricanes, tornadoes, hail. If you're buying near the Gulf, get an insurance quote for the specific address before you commit — see the US home insurance guide for why standard policies never cover flooding.

Texas protects your home — with strings

Texas has one of the strongest homestead exemptions in the country — unlimited value for your primary residence against judgment creditors (not mortgage lenders). Texas also has unique home equity loan rules: borrowing is capped at 80% combined LTV, requires a 12-day cooling-off period before closing, and cannot close at the property itself.

Those home-equity rules are worth knowing before you ever borrow against the house. Foreclosure in Texas is nonjudicial and fast — often around 2 months — and the state does not offer broad anti-deficiency protection, so keeping an emergency buffer matters more here than in some states.

General overview only — laws change. Consult a real estate attorney for advice specific to your purchase.

Programs that help first-time buyers

• TDHCA My First Texas Home
• Texas Mortgage Credit Certificate
• Home Sweet Texas

Run your own numbers

The Texas mortgage calculator builds in a local property-tax estimate, so the monthly figure reflects the tax reality — not just principal and interest. Pair it with the deposit guide to decide how much to put down.