Texas continues to be one of the more affordable states to live in the U.S. In 2025, the overall cost of living in Texas is about 5% lower than the national average. With lower housing costs, competitive healthcare, and no state income tax, Texas offers solid value for both individuals and families.
- Single Person: ~$3,567/month or ~$42,800/year
- Family of Four: ~$4,740/month or ~$56,880/year
From thriving metro areas to quiet, budget-friendly towns, Texas has options to suit a wide range of financial situations and lifestyle needs.
Housing Prices: Renting vs. Buying
Housing is one of the biggest factors contributing to Texas’s affordability. The median home price in Texas is around $297,600, which is about 12% less expensive than the national average. Renters also benefit from below-average prices, making Texas attractive to both homebuyers and renters.
- Median Monthly Mortgage: $1,747
- Average Gross Rent: $1,167
- 2-Bedroom Rent Average: $1,280/month
Average Rent Prices Across Major Cities
Texas cities vary widely in housing affordability. Here’s how major cities stack up:
- Austin: $481,739 (home value), 3% lower overall cost
- Dallas: $361,199, 2% higher than the national average
- Houston: $296,083, 6% below national average
- McAllen: $161,690, 15% below national average
- Harlingen: $260,000, 18% below national average
Whether you’re looking for urban energy or small-town peace, you’ll find diverse housing options across the state.
Utilities and Monthly Expenses
Texas utility costs are relatively average, with the monthly average around $402. These include:
- Electricity: $132/month
- Gas: $111/month
- Water: $45/month
- Cable & Internet: $114/month
These expenses are just 1% higher than the national average, making utilities fairly manageable across the state.
Hidden or Seasonal Costs to Watch For
- High summer A/C bills due to long, hot seasons
- Hurricane prep for Gulf Coast residents (insurance, storm-proofing)
- Water usage fees can vary by municipality and drought season
- Rural propane or well services may have higher seasonal spikes
Planning for seasonal shifts can help avoid surprises in your monthly budget.
Taxes in Texas: What Residents Pay
Texas is one of the few states that does not charge state income tax, making it a smart choice for high earners, retirees, or remote workers. However, that savings can be offset by:
- Higher-than-average property taxes
- Sales tax: Generally between 6.25% and 8.25% depending on your area
No state income tax is a major draw for many new residents, helping offset other costs.
Best Cities with the Lowest Cost of Living in Texas for Affordability
| Harlingen | 18% below thenational average |
| Seguin, Amarillo,Texarkana | 17% below |
| Brownsville | 16% below |
| McAllen | 15% below |
| El Paso | 12% below |
These cities combine low housing prices, reasonable grocery costs, and lower-than-average utility bills.
Tips for Budgeting in Texas
Compare cities using cost of living calculators before deciding where to move
- Budget for utilities, especially if living in warmer regions
- Research property taxes by county when buying a home
- Track your expenses to adjust for seasonal changes in energy usage
- Take advantage of no income tax to boost savings or retirement contributions
Proactive budgeting will help you make the most of the financial benefits Texas offers.
Is Living in Texas Worth It in 2025?
Yes — for many people, living in Texas is absolutely worth it in 2025. With a lower cost of living, growing job opportunities, and no state income tax, Texas remains a top destination for families, professionals, and retirees.
Whether you’re settling in bustling Austin, diverse Houston, or affordable Amarillo, Texas offers a compelling blend of affordability and quality of life.