The short answer
At today's Austin prices and rents, and using our standard assumptions, owning does not overtake renting at any point in 30 years. Not in year 7, not in year 15, not in year 30.
That is an unusual result and we are not going to soften it. It is also not the whole story — one assumption is doing most of the work, and we show you which one below.
| Input | Value | Source |
|---|---|---|
| Typical home value | $431,166 | Zillow Home Value Index (ZHVI), single-family homes only, smoothed & seasonally adjusted (Metro_zhvi_uc_sfr_tier_0.33_0.67_sm_sa_month.csv) (July 2026) |
| Typical single-family rent | $2,321 / month | Zillow Observed Rent Index (ZORI), single-family residences, smoothed (Metro_zori_uc_sfr_sm_month.csv) (July 2026) |
| Effective property-tax rate | 1.54% | 2025 adopted rates per $100 for a homesteaded house inside the City of Austin and Austin ISD: Austin ISD 0.9252 on price − $140,000 (AISD grants the state exemption only, no local percentage), plus City of Austin 0.524017, Travis County 0.375845 and Travis Central Health 0.118023 on 80% of price (each grants the 20% local-option homestead exemption), plus Austin Community College 0.1034 on the full price. On a $431,166 purchase that is $6,651 a year — 1.5425%, rounded to 1.54% to match the precision we use for the ACS rates. Outside the city, or in a MUD, the bill is higher: Travis County MUD rates run from 0.221 to 0.95 per $100 on top of this and mostly carry no homestead exemption. Why not the Census ratio: Texas caps assessed-value growth at 10% a year for homesteaded owners and resets it on sale, so the ACS median-over-median ratio describes long-tenured capped owners rather than a buyer. It is also out of date on the law: the 2019-2023 window predates the school homestead exemption rising from $40,000 to $100,000 (2023) and then to $140,000 (2025), which is a flat dollar subtraction and so bites hardest at exactly this price point. For the record, that ratio is 1.60% — $6,973 median taxes paid ÷ $434,800 median home value for CBSA 12420, per US Census Bureau, American Community Survey — tables B25103 (median real estate taxes paid) and B25077 (median home value), metro level (2023 5-year estimates).Travis County Tax Office, Truth in Taxation — 2025 adopted tax rates for all Travis County taxing units; homestead exemptions per Austin ISD's published exemption schedule and the City of Austin, Travis County and Central Health 20% local-option exemptions (2025 adopted rates) |
| Homeowner's insurance | $3,019 / year | Hays, Travis and Williamson Counties. Policy-weighted mean of the Texas Department of Insurance's 2025 county averages for policies including windstorm: Travis $3,245 (272,866 policies), Williamson $2,758 (152,007) and Hays $2,688 (66,755) — 491,628 policies in all. TDI collects these from insurers as premium charged, not as quotes. The average coverage behind these policies is $517,186, above the $431,166 typical home value this page prices, because a replacement-cost policy insures the structure at rebuild cost and the policy base skews newer and larger. Read it as the metro's average bill, not as your quote. This page previously published $3,150, a quoted premium from a rate-comparison sample at a fixed $300,000 of coverage. Quotes run above what insurers actually write, so we moved to the written figure.Texas Department of Insurance, homeowners insurance market overview — average premium and average coverage by county, policies active as of 12/31, policies including wind. Counties per US Census Bureau / OMB, Core Based Statistical Area delineation — central counties of each CBSA (July 2023); the quoted premium it replaced per Insurance.com (Quadrant Information Services) average annual homeowner's premium by ZIP code — $300,000 dwelling coverage, $300,000 liability, $1,000 deductible, 2% hurricane deductible in Florida; averaged over the CBSA's central counties and weighted by owner-occupied units (August 2026) (2025 (preliminary)) |
Why Austin lands here
Austin is the metro where people most often assume the correction already settled the question. Prices came a long way down from the 2022 peak, so the reasoning goes, buying must be the obvious move now.
The price did come down. The carrying cost did not.
A $431,166 Austin home at our default 6.5% mortgage carries $6,640 a year in property tax and $3,019 a year in insurance. That is roughly $805 a month in tax and insurance alone — before a single dollar of principal, interest, or maintenance. For context, that carry is about 35% of what it costs to rent the same house outright.
Texas has no state income tax. That money is collected somewhere, and a 1.54% effective property-tax rate is where — the third-highest of the metros we cover, behind Chicago and Miami, even after the state's large homestead exemption is applied. It is levied on a home that is not especially cheap: Austin's price-to-rent ratio of 15.5 sits in the middle of our set, well above Houston, Chicago or Pittsburgh.
Insurance, by contrast, is the cheapest of the Gulf and Atlantic Sun Belt metros here at $3,019 a year — though Phoenix, with no hurricane exposure at all, pays less than half as much. Austin is inland Hill Country; Houston, fifty miles from open water, pays about 37% more. That figure is the Texas Department of Insurance's own 2025 county data — the premiums insurers actually charged across 491,628 policies in Travis, Williamson and Hays — rather than a quote. Until recently this page and Houston's published the identical state-average premium, which was wrong for both; when we replaced that with a quote priced by ZIP code, Austin came out at $3,150, within 4% of what TDI says people here are really billed. Of the pages on this site, Austin is the one where the quoted number turned out to be about right.
Put the two together and the month-one comparison is stark: $3,347 to own versus $2,336 to rent. Owning costs over $1,000 a month more from day one, and the buyer has also handed over $96,357 in down payment and closing costs that the renter still has invested.
The home does appreciate, and the mortgage does amortise. But rent would have to rise a long way before the monthly comparison flips, and by the time it does, the renter's invested capital has been compounding for two decades.
The assumption that decides it
Our default assumes the renter invests their unspent capital and earns 7% a year — a long-run, all-equity figure. That is the single most decisive input on this page, and in Austin it is close to the only thing that matters.
Drop it to 5%, which is what our own tooltip suggests for a more cautious, bond-heavy mix, and Austin's answer changes completely: owning breaks even in year 13.
So the honest framing is not "never buy in Austin." It is this: in Austin, buying is a bet that your alternative investments will underperform. If you genuinely expect 7% from the market over 30 years, renting and investing wins here. If you would have left the down payment in cash or bonds, buying wins comfortably. Most people never make that comparison explicit. It is the whole ballgame in Austin.
What we are not modelling, and where it cuts
Two things, and they cut in opposite directions.
Our property-tax rate is derived, not assumed — and it is not the Census figure. This page used to report the Census ratio of 1.60% and tell you it was probably too low for a new buyer, because Texas caps assessed-value growth at 10% for homesteaded owners and the cap resets on sale. The cap is real, but we were asserting a direction we had never derived, and we had left out the offsetting factor: Texas's homestead exemption is very large in flat dollars.
So we derived it. For a homesteaded house inside the City of Austin and Austin ISD, at 2025 adopted rates, the bill is about $6,640 a year on a $431,166 purchase — 1.54%, slightly below the Census figure rather than above it. The line-by-line arithmetic is in the table above.
The Census ratio has a second problem we had not noticed: its 2019-2023 window predates the school homestead exemption rising from $40,000 to $100,000 in 2023 and to $140,000 in November 2025. It describes the wrong taxpayer and the wrong statute.
Buy outside the city, or in a municipal utility district, and the bill goes back up — Travis County MUD levies run from 0.221 to 0.95 per $100 on top of everything above, and mostly carry no homestead exemption. Look up the taxing units at your actual address and put that number in the field. We are no longer telling you which way to move it; it depends on where you buy.
We use one national appreciation rate everywhere. Every metro page on this site assumes 3.5% annual home-price growth, because metro-level appreciation over the next decade is a forecast, not a measurement, and we will not dress one up as the other. If you have a well-founded view that Austin outperforms the national average, raise it and re-run. It is the fastest way to move this particular answer.
Check it yourself
Every number above is pre-loaded. Nothing is hidden, and you can change any of it.
Open this Austin scenario in the calculator →
If you want to understand the machinery rather than just the answer, how the break-even year actually works explains what the crossing point means, and the opportunity cost of your down payment covers the return assumption that decides this page.