Rent vs Buy in Austin, TX
Austin is a mid-priced metro, with a median listing price of $475,000. That puts it in territory where the rent-vs-buy call hinges on your rate, your down payment, and your stay length rather than the market itself.
Rent runs about $1,301 a month here, which leaves Austin with a high price-to-rent ratio. That generally tilts the monthly math toward renting, with buying gaining only as equity and appreciation build over time. With Texas charging no state income tax, the mortgage-interest and property-tax deductions reach only the federal return.
How Austin compares
- Homes in Austin cost 7% more than the national median of $443,255.
- Rent in Austin runs 41% lower than the U.S. median of $2,200/mo.
- Homes in Austin cost 32% more than the Texas median of $359,950.
What the numbers say
At 1.54% on a $475,000 median home, property tax in Austin works out to roughly $610 a month ($7,315 a year). It is the largest owning cost with no renting equivalent, so factor it in before you compare.
Average rent sits at $1,301 a month ($15,612 a year), the anchor for the renting side. With appreciation near 6.0% a year, Austin sits close to the long-run norm, so the calculator's conservative 3 to 3.5% anchor lines up with recent local experience.
Homeowners insurance is modeled at the Texas average of $3,100 a year; swap in a real quote once you have a specific home.
What makes the rent-vs-buy math different in Austin
Austin's price-to-rent ratio is about 30.4: the $475,000 median price divided by $1,301 a month in rent over a year. That is a high ratio, where renting frequently costs less each month and the buy case rests on a long hold plus price growth. Think of the ratio as a quick first read. It will not settle the decision on its own, but it shows which side starts in front.
With a high ratio, owning in Austin usually costs more each month than renting for the early years, maintenance aside. The gap closes only as you pay down the loan and prices rise, so the real question is how long you plan to stay.
A handful of Austin particulars matter once you look past the ratio alone. Texas caps the taxable appraised value of a residence homestead at 10% growth a year, which limits how fast an owner's property tax bill can climb in the years after a purchase. Source. Census data shows about 17.1% of residents moved within the prior year and 52.3% of adults hold at least a bachelor's degree, a mobile and highly educated metro where a shorter expected stay can tilt the math toward renting. Source.
Home Purchase
Enter details about the home you're considering buying
Renting
Enter details about your rental alternative
Time Horizon & Market
Detailed mode adds 17 more inputs including advanced assumptions.
Buying is cheaper over 7 years
by $31,485
Buying comes out ahead, though the margin is meaningful only if you stay the full term and your assumptions hold roughly true.
The result is robust across small changes to your inputs.
Total cost of buying
$387,138
Average $4,609 per month over 7 years
Total cost of renting
$207,949
Average $2,476 per month over 7 years
Equity Built
$245,691
What you've paid down on the loan principal over 7 years.
Net Sale Proceeds
$211,339
What you'd walk away with after selling, minus closing costs.
Investment Growth
$65,204
What the down payment could grow to if invested instead of used to buy.
This chart shows total dollars spent on each path, month by month. With your inputs and time horizon, renting stays ahead the entire time.
Frequently Asked Questions
By Barron Hansen, Founder · Last reviewed