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Why Are Houses In Texas So Cheap? (Top 10 Reasons)

By Brittany Olizarowicz April 28, 2021

Texas New Construction New Homes

 

Many news stories are showing that more and more people are choosing to move to Texas.

There are big reasons people love Texas, but it is still surprising to most that the cost to live in Texas is still so cheap.

If you are thinking about a move to Texas and curious about why the prices of homes seem so fair, we have all the info you need.

There are some excellent reasons Texas is so cheap, and it may be worth taking advantage of those reasons as soon as possible.

As we know all too well with real estate, these fair prices are probably not going to last all that long.

Here are the top ten reasons houses in Texas are so cheap.

 

Why Are Houses in Texas So Cheap?

 

1. Lots of Land

Aerial of the Small Rural Town of Sommerville, Texas

 

Texas has a lot of land.

When you look into areas where the housing costs are very expensive, like Manhattan or California, you will notice that the amount of land they have is quite limited.

Land in Texas is not limited.

This is partly why so many people are choosing to build houses in Texas.

They can start from the ground up, pick a lot they want, and have acres of land if they wish.

The availability of land has also made it so that builders can purchase large lots of land and put developments up.

The more houses that builders put in, the more supply there is on the market, and the overall costs to purchase will go down.

This comes down to the old business concept of supply and demand.

In Texas, the supply is high, but the demand has not entirely caught up yet.

There are certain areas of Texas where the land is a bit more limited.

One spot that you will likely hear more and more about is the Austin area.

Austin is not as open as far as land is concerned.

You will find that this area is getting quite popular, and people want to live there.

Therefore, the land is not as relatively cheap in this area.

Overall, the access to land is something that makes Texas extremely affordable to live in.

 

2. Location Specific

Texas land for sale expanding housing development

 

Although cheap can be a relative term, there are areas of Texas that are more expensive than others.

Depending on your location, the pricing in Texas may not be all that cheap.

The idea is that the closer you get to the premium locations, the more you will end up paying.

However, there are not that many premium locations in the state of Texas.

Even the major cities are going to be rather middle-income, with the exception of the growing Austin area.

If you want a simple house that is far from a city, you will not pay very much at all.

Of course, the reason behind this has partly to do with what is located around the home.

If the home is not near the things you need it to be near, then your pricing will be impacted.

After all, real estate pricing always goes back to location, location, location.

With so much land and so many locations all over Texas, not all of these areas are great places to live.

If you want the best areas, you are going to have to pay just a bit more money.

 

3. Proximity to Major Cities

Dallas, Texas cityscape with blue sky at sunset, Texas

 

There are some major cities in Texas that attract a lot of people.

These cities are known for having jobs, entertainment, sightseeing, and more.

The problem is that the access to the major cities is not that easy for such a large state.

There are areas in Texas where you can live and be located hours from a major city.

These homes are located so far from any type of area that attracts tourism or business that your pricing is going to be quite a bit lower for your home.

In areas like California, where there is one great city or town after another, the pricing increases quite a bit.

All of the homes can be advertised as being within 20 minutes of anything that they need.

With Texas, you can be hours from all that a city has to offer.

If you have your own business or work remotely, this may not be an issue.

However, if you need the city as a source of income, things get a bit more difficult.

The farther away you get from Texas cities, the cheaper the pricing of the homes go, and they get to the point of being much cheaper.

Of course, the lifestyle that these homes provide is not something that everyone will want to live with.

 

4. Low State Taxes

State Taxes and an arrow with stormy sky background

 

Overall, the state taxes in Texas are low.

This makes the overall cost of owning your home that much more affordable.

When you look at your home prices and the monthly price, you must also consider the impact of the taxes.

For states that have low income tax rates, you will find that the overall cost of living is quite a bit lower.

This makes the amount that you are paying every month to live in your home that much more affordable.

You must also look at other expenses in Texas like utility costs and food costs.

Overall, the cost of living is quite fair, and it makes housing in Texas that much cheaper.

When you combine that with the very low mortgage rates that we have on the market currently, the overall cost to own is relatively low.

When you look at home prices and the cost of living, you must consider the prices of everything that you pay for every month.

If you end up having to pay extra because of the fees like taxes or high utility costs, it can really throw off home prices and the cost to own.

 

5. Cheap Labor—Workers Can’t Afford High-End Housing

Word writing text Cheap Labor

 

Texas is not known for having the highest wages.

There is a need for workers, but the jobs are not all that high-paying.

With a lower paying job, workers won’t be able to afford the high cost of living.

When you look at an area like Manhattan and think about a tiny one-bedroom apartment selling for $1.2 million, it may seem astronomical.

However, when you look at the income rates and the money that people are making, you may change your mind about these real estate prices.

Someone working in Manhattan can make $500,000 a year quite easily.

Taking this kind of income and then applying it to a place for $1.2 million should not cause any issues.

This same concept can apply to areas where the wages are a bit lower.

Let’s say that a person in Texas is making $40,000 per year.

If this person purchases a home for $125,000, it certainly seems to be a similar ratio to what goes on in New York.

The idea is when you start seeing higher wages, it will have an impact on the housing prices as well.

We are starting to see this happening in the Austin area.

Large companies are moving to the area, and the higher payrolls are making the cost of the local houses increase quite a bit.

Overall, you will be impressed with what you get in the Texas area for a very fair price, but finding a job that pays enough for you to afford a more expensive house is going to be difficult in some areas in Texas.

 

6. Relaxed Building Codes

Building Codes

 

Some areas of the country have very strict building codes.

If you don’t have the proper permits and have everything built to regulation and code, you will have a hard time even putting a shovel in the ground to start.

However, in Texas, the building codes are actually quite relaxed.

Although there will always be local ordinances and things that must be followed, the overall process is rather simple and will not cause too much trouble when it comes to building.

This, of course, makes both people and builders want to come to Texas to get their homes built.

When builders don’t have to wait years just to get permission to start their build, they can make homes faster.

Homes that are made faster with fewer hold-ups and regulations are also made quite a bit cheaper.

Therefore, when all is said and done, the pricing that you pay for your Texas home is also cheaper.

Although some will worry about the overall quality because of these regulations that are not nearly as strict, the builders still have to build to a certain quality.

Almost all new homes are going to come with some kind of a warranty.

These warranties are something that the builders are not going to want to have to deliver on.

If the house is built right the first time, there should be no issues with the warranty holding up, and that is the goal for all builders and buyers.

Overall, you should not look at the relaxed building codes in Texas as a negative.

Instead, consider this a positive and use it to your advantage to secure a home for a very low price.

After all, you are the one who is going to have to pay for the home, so you might as well get something for a great deal.

 

7. Very Few “Views”

aerial amazing gorgeous view over Central Texas

 

Have you ever noticed that homes along the water or in the mountains tend to sell for quite a bit of money?

In fact, even a home that has a lake view will go for more money than something that lacks a view.

The reason behind this is that the views that people want will make a property much more expensive.

In Texas, there is a significant lack of good views.

Overall, the state is rather flat and not all that appealing in most areas.

This leads to people having to compromise when it comes to a view.

You will find that most of the homes that are being built are going to simply have a view of their own yard and not really much else around it.

The house itself won’t offer much from a view standpoint, but the inside of the home will have a lot to offer.

When you purchase a home along the coast of Florida or in the foothills of the Rocky Mountains, be ready to pay for those views.

Since Texas doesn’t have all that much to offer, you will save a few dollars on the cost of your home.

 

8. No Rent Control—Lower Rental Costs

Wooden houses and an easel arrow down

 

Since rent costs are low in Texas, it keeps people in their rentals.

When rental costs get high, people begin to consider the idea of purchasing a home.

The home purchase can sometimes make more sense because it will help to lower the overall costs and allow you to gain equity at the same time.

However, once you get into a situation where the rents are much cheaper than what the mortgage payments would be, people start to hold off purchasing.

The fewer people who are in the market for a home, the lower the pricing on the homes are going to have to be.

People who want to move need to lower their home prices so that they are able to sell the home to the few buyers who are in the market.

Texas does not control rents, so the rents are going to be a bit all over the place, and therefore, you will find that you can get some great deals.

Until the rent prices start to increase, we likely won’t see too much of an increase in the pricing of the real estate.

 

9. Sand and Concrete is Readily Available

Warehouse of bulk materials

 

When building homes, part of the trouble is the access to supplies.

For some areas where there are difficult roads or islands that are only accessible by boat, building supplies are often quite expensive.

In states where there are very few natural resources, you will also notice that building supplies cost a ton.

Overall, though, Texas is a great place when you need both sand and concrete.

There are many local areas where you can get sand and concrete, and this makes the cost for building much cheaper.

The lower cost of building is, again, going to make the houses cheaper, and it will bring down the values on the pre-existing homes as well.

If someone can purchase a home for $300,000 or build a brand-new one for $300,000, they are probably going to want to build to their specifications.

Although there is always a wait when building your own home, overall, most people find it is worth the wait to get to enjoy their own property.

With the weight of sand and concrete, if it needs to be delivered over long distances, it is going to get quite costly.

You can avoid these high costs when you live in Texas and are close to these facilities that can deliver what you need.

Of course, you will still need lumber when building a house, and the cost of lumber at any given time can certainly have an impact on your overall cost.

With the current high prices of lumber, it will have an impact on the pricing of the homes that you build but waiting for lower lumber prices could increase other costs.

People who are building homes need to decide on the right time based on their needs and not on the current costs within the market.

These costs will always change, and you must make decisions on what you need at the current time.

 

10. Moderate Climate—Lower Cost to Build and Own

Aerial View Fort Worth Texas

 

Last but certainly not least is the fact that the overall climate in Texas can be rather moderate.

In most areas, you won’t have to worry about ice and rough winters.

This makes it so that the cost of building and then the cost to own for Texas houses will be a bit more affordable.

Most of the summers in Texas can be a bit warm, but the humidity is not always all that severe.

Homes don’t have to be built with as much consideration for things like hurricanes, either.

Although a hurricane can skirt the coast of Texas, it is a bit rarer in the rest of the state than in other areas of the country.

Moderate climate usually makes people want to move to Texas as well.

Typically, this increases the cost of the real estate, but with the current market and the fact that people do not want to move to Texas quite as fast as other states, the pricing still stays low.

With all the inventory on the market, it takes a long time for the pricing in the Texas markets to increase or decrease by all that much.

Some people will own a home in Texas for many years and notice that the increase in the value of the home was right in line with inflation.

The ups and downs are not nearly as severe as they are in other parts of the country.

However, this tends to be a good thing because you will feel more secure in the property you purchase and the thought that someday, it will still be worth a good amount of money.

 

Is Buying a House in Texas Worth It?

woman thinking

 

Now that you can see why homes in Texas are so affordable, you may be wondering if it makes sense for you to purchase one.

There are some really great things about living and working in Texas, and you will have to decide if these things match up with your goals in life.

We will tell you that the fact that you can live an affordable life in a nice home is a great reason to move to Texas.

For those who are coming from out of state and have real estate to sell, you may find that the pricing in Texas will enable you to purchase your dream home.

We also like the fact that Texas is relatively centrally located.

If you want to fly south for a vacation, it is pretty easy to do.

If you want to head over to the coast for a beach trip, you will have the opportunity.

In the winter, if you want to go for a ski trip, you have just a short flight to get you there.

Living in the middle of the country does provide some excellent access to almost anything you could want to do.

Lastly, if you are interested in purchasing land and having a farm or animals, Texas is a smart place to be.

You will find that you can get quite a bit of space and turn your property into something that you enjoy and works well for your family.

If your goals are unattainable in other states, give Texas a try.

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Filed Under: Travel Tagged With: Texas

About Brittany Olizarowicz

Britt Olizarowicz is a freelance writer, author and mother of two young children. With a history as a golf professional, real estate agent and business owner, Britt has a wide range of experience and knowledge in a variety of topics. Britt thoroughly enjoys educating and sharing information with readers.

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