You don’t have to look far to find a reason to move to Texas. From its wide-open skies to its amazing BBQ and country music, there are a plethora of reasons to love the state. But before you start packing your bags, you might want to know, is now a good time to buy a house in Texas?
Although the right time depends on your personal and financial situation, high rental costs, low mortgage rates, and tax laws that favor homeowners make 2022 an exciting time to buy a home in Texas.
Continue reading as we explore the reasons you should consider buying a home in Texas as well as some of the best places in Texas to buy a house right now.
Reasons To Buy a House in Texas
Deciding where you want to plant permanent roots is a big decision, but here are four reasons you should think about buying a home in Texas in 2022.
1. Take Advantage of Low-Interest Rates
At its most basic, an interest rate is an agreed-upon percentage of the principal loan balance that you will pay as a fee to the lender for the use of their money. The details about interest rates can get a bit tricky to understand, and, although we will not go into too much detail here, it is highly recommended that you research the different types of interest rates before buying a home.
When the pandemic hit, the market price for houses skyrocketed. Since buyers were suddenly forced to bid above a house’s value if they wanted to win the bidding war, banks started offering lower interest rates as an incentive to still buy. Luckily, market prices have begun to level off, but interest rates remain low, and buyers can take advantage of these two conditions when they buy a home in Texas right now.
2. Expanding Job Market
Another side effect of the pandemic was how it affected the job market. States started offering incentives to stay home, and a lot of people gave up positions or refused work in leu of collecting unemployment benefits. This created gaps that need to be filled within many fields and expanded the job market.
This is a good reason to buy for a couple of reasons. First, people might move to Texas to take a better-paying position or to take advantage of the job market. Second, as people migrate to the state for work, the housing market will rise again. Buyers can take advantage of the market before prices are once again pushed back up.
3. High Rental Costs
In 2018, the fair market rate for a 4-bedroom rental in Texas was $1,275. Today, the same 4-bedroom rental would be valued at $1,365 (and likely rented out for over that price). As the price of renting becomes higher and higher, it can often be less expensive to buy a home since many monthly rentals end up being more expensive than a monthly mortgage.
Additionally, with the price of fuel and electricity going up, many property owners do not include heat and electricity any longer. If you are paying for lights and heat and could have a lower mortgage payment, it makes sense to put your money towards something that you will eventually own rather than paying for someone else’s home.
4. Tax Breaks
If avoiding high rental costs and locking yourself into low-interest rates are not good enough reasons, the tax breaks you may get as a homeowner might make you think twice about buying a house. Exactly what those tax breaks look like will depend on where you live (you can find a good summary of homeowner tax breaks in Texas here), but these deductions are just one more reason you should think about buying instead of renting.
Best Places to Buy a House in Texas
The following cities and towns have been voted as some of the best places to buy a house in Texas. If you decide to take the plunge, you may want to think about browsing the market in one of the places listed below.
1. Austin, Texas
Known as the live music capital of the world, Austin is the state capital of Texas. Its sunny weather, bustling culture, and growing tech market make it a beautiful place for younger generations to live. Additionally, Intercap Lending recently voted Austin as the #1 city where housing prices were expected to rise over 20% in 2022. If you are looking to buy a house that is guaranteed to appreciate, Austin is the place to do it!
2. McKinney, Texas
Located in Collin County, Texas, McKinney has an excellent school system and a low crime rate. Additionally, it is situated about 30 miles from Dallas, making it a wonderful place for commuters who want to avoid the big city life. Voted as the fourth best place to buy a home in 2022 by Bloomberg, McKinney is a fantastic location for families and professionals.
3. Frisco, Texas
Ranked as the second safest city in the United States, Frisco has topped many “best places to buy” lists, but it’s not just safety that draws people to this charming town. Frisco has some of the best educational opportunities in Texas and is located close to many larger cities, including Fort Worth, making commutes a breeze.
4. Shady Hollow, Texas
It might sound, well, shady, but Shady Hollow has been voted one of the Best Suburbs to buy a house in Texas. With a population of only 4,473, it offers a small-town vibe while still being only ten miles from downtown Austin.
5. Waco, Texas
Located in central Texas, Waco is a booming city. In just the past five years, homes in Waco have appreciated by as much as 70%, while the average cost to purchase a home remains 30% below the national average at just $182,229. Voted as one of the best places to live in Texas by Policy Genius, Waco offers amazing recreational opportunities in a quickly growing community.
You may also like: