AUSTIN HOME BUYING 2026

Buying a Home in Austin 2026: First-Time Buyer Guide

Q: How much income do I need to buy a home in Austin in 2026?

To buy a median-priced home in Austin ($545,000 in July 2026), you need approximately $115,000 in annual income with 20% down ($109,000). With 5% down, you need about $135,000. Austin prices have cooled from their 2022 peak, making it more affordable than Seattle or San Francisco but still pricier than Dallas or San Antonio.

Q: Is Austin a buyer's market in 2026?

Yes, Austin is now a buyer's market in 2026. Median home prices are $545,000, down 2.1% year-over-year. Inventory is up 22% from 2025, homes sit on the market 35 days on average, and only 22% sell above asking. This is a dramatic shift from the 2021-2022 seller's market. Buyers have significant negotiating power.

Q: What are the best first-time home buyer programs in Austin?

Austin offers several programs: (1) Texas TSAHC Home Sweet Texas — up to 5% DPA, (2) TDHCA Texas Homebuyer Program — up to 5% DPA as a forgivable second mortgage, (3) My First Texas Home — 30-year fixed with DPA, (4) FHA loans with 3.5% down (Travis County limit: $567,500 in 2026), (5) Conventional HomeReady/Home Possible with 3% down. Compare lenders to find the best program.

Q: What are the best neighborhoods for first-time buyers in Austin?

Best neighborhoods for first-time buyers in Austin 2026: (1) Round Rock — median $420K, great schools, 20 min to downtown, (2) Pflugerville — median $395K, diverse, growing, (3) Cedar Park — median $450K, family-friendly, top schools, (4) Buda — median $380K, small-town feel, south of Austin, (5) Manor — median $350K, most affordable, east of Austin. Avoid Zilker and Tarrytown where medians exceed $900K.

Q: How much are closing costs in Austin?

Closing costs in Austin typically range from 2-4% of the purchase price. On a $545,000 home, expect $10,900-$21,800. Texas has no state income tax but property taxes are high — Travis County averages 2.2% of assessed value (one of the highest in the nation). On a $545K home, that's about $12,000/year in property taxes. Factor this into your monthly budget.

Q: Are Austin home prices dropping in 2026?

Yes. Austin median home prices are $545,000 in July 2026, down 2.1% year-over-year. The market has cooled significantly from the 2022 peak of $575,000. Inventory is up 22%, and homes sit 35 days on market. This creates a buying opportunity — but high property taxes (2.2% in Travis County) offset some of the price advantage. Compare lenders to find the best rate.

Austin median home price: $545,000 — down 2.1% YoY. Inventory up 22%, homes sitting 35 days. It is a buyer's market. Here are the best neighborhoods, DPA programs, loan options, and a step-by-step plan to get approved.

TL;DR

Quick Summary: Austin Home Buying 2026

✓ Median home price: $545,000 — down 2.1% YoY (July 2026). Buyer's market.
✓ Income needed: $115,000+ with 20% down, $135,000+ with 5% down.
✓ Inventory up 22% — significant buyer negotiating power.
✓ FHA loan limit Travis County: $567,500 — 3.5% down up to this price.
✓ TSAHC Home Sweet Texas DPA — up to 5% down payment assistance. Search DPA programs →
✓ Best affordable neighborhoods — Manor ($350K), Buda ($380K), Pflugerville ($395K).
! Property tax: 2.2% in Travis County — among highest in the US. Budget $12K/year on $545K.

Compare Austin Mortgage Lenders Now →

David Rodriguez

Refinance & Rate Specialist

July 14, 202612 min readExpert

Mortgage RefinancingRate AnalysisMarket Trends

Austin's housing market has transformed. After the explosive 2021-2022 boom that saw prices hit $575,000, the market has cooled significantly. July 2026 data shows a median price of $545,000 — down 2.1% year-over-year. Inventory is up 22%, homes sit 35 days on market, and only 22% sell above asking.

This is a buyer's market — the strongest in over five years. But Austin buyers face a unique challenge: property taxes. Travis County's average effective rate of 2.2% is among the highest in the nation, adding $12,000/year to the cost of a $545K home. Factor this into your budget.

Ready to buy in Austin? Compare Austin mortgage lenders →

Austin Housing Market Data — July 2026

Metric	Austin (July 2026)	National Avg
Median home price	$545,000	$415,000
YoY price change	-2.1%	+1.6%
Inventory change YoY	+22%	+12%
Days on market	35	28
% selling above asking	22%	25%
Income needed (20% down)	$115,000	$95,000
FHA loan limit (Travis County)	$567,500	$832,750
Property tax rate	2.2%	1.1%

Austin's property tax rate of 2.2% is double the national average. On a $545K home, that's about $12,000/year ($1,000/month) in property taxes alone. Texas has no state income tax, but high property taxes offset that benefit. Compare FHA lenders in Texas →

How Much Income Do You Need to Buy in Austin?

Income Needed by Down Payment (Median Home: $545,000)

Down Payment	Loan Amount	Monthly P&I + Tax + Ins	Income Needed
20% ($109,000)	$436,000	$4,518	$115,000
10% ($54,500)	$490,500	$4,832	$125,000
5% ($27,250)	$517,750	$5,012	$135,000
3.5% FHA ($19,075)	$525,925	$5,089 + MIP	$140,000

Includes property taxes (2.2%) and insurance ($2,400/yr). Does not include HOA if applicable.

Tip: Austin's high property taxes mean your monthly payment is significantly higher than the national average for the same loan amount. Use TSAHC or TDHCA DPA to reduce your upfront costs. Search Texas DPA programs →

Best Austin Neighborhoods for First-Time Buyers

Neighborhood	Median Price	Why Buy Here
Manor	$350,000	Most affordable, east of Austin, growing fast
Buda	$380,000	Small-town feel, south of Austin, good schools
Pflugerville	$395,000	Diverse, growing, 20 min to downtown
Round Rock	$420,000	Great schools, tech corridor, family-friendly
Cedar Park	$450,000	Top-rated schools, safe, northwest of Austin
Kyle	$365,000	Affordable, south of Austin, commuter friendly

Avoid Zilker ($950K+), Tarrytown ($1.1M+), and Mueller ($650K+) unless you have a high budget. Focus on suburbs north and east of Austin for the best value. Round Rock and Cedar Park offer top-rated schools at reasonable prices.

Get Pre-Approved for an Austin Home

Compare 50+ lenders. FHA, VA, conventional, TSAHC DPA. See rates in 3 minutes.

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Austin & Texas Down Payment Assistance Programs

1. TSAHC Home Sweet Texas

Up to 5% of loan amount as a forgivable second mortgage. Available with FHA, VA, and conventional. Income limits up to $115K for Travis County. No first-time buyer requirement. Check eligibility →

2. TDHCA My First Texas Home

30-year fixed-rate mortgage with up to 5% DPA as a forgivable second mortgage. Income limits vary by county. First-time buyers and veterans qualify. Combined with TDHCA MCC for tax savings.

3. TDHCA Texas Homebuyer Program

Provides a 30-year fixed mortgage plus down payment assistance up to 5%. Available to first-time buyers and those who have not owned a home in 3 years. Income limit: $115K for most Texas metros.

4. FHA Loan — 3.5% Down

FHA allows 3.5% down with 580+ credit. Travis County FHA limit: $567,500. On a $545K home, that's $19,075 down. MIP required. Compare FHA lenders →

5. HomeReady / Home Possible — 3% Down

Fannie Mae HomeReady and Freddie Mac Home Possible: 3% down with 620+ credit. Income limit: 80% AMI. Lower PMI than standard conventional. On $545K, that's $16,350 down.

Step-by-Step Plan to Buy in Austin

Step 1: Budget for Property Taxes (Week 1)

Austin's 2.2% property tax rate is a game-changer. On a $545K home, budget $12,000/year ($1,000/month) for taxes. Use a mortgage calculator that includes taxes and insurance. Check your budget →

Step 2: Get Pre-Approved (Week 2-3)

Compare at least 3 lenders. Get pre-approved — in a buyer's market, pre-approval still matters. It shows sellers you are serious. Compare Austin lenders →

Step 3: Apply for TSAHC/TDHCA DPA (Week 3-4)

Apply for TSAHC Home Sweet Texas or TDHCA programs. Up to 5% DPA can cover your entire down payment. Processing takes 2-3 weeks. Search Texas DPA →

Step 4: Tour Homes in Suburbs (Week 4-6)

Focus on Manor, Buda, Pflugerville, and Round Rock. With 35 days on market, you have time to negotiate. Tour at least 10-15 homes before making an offer.

Step 5: Negotiate Hard (Week 6-10)

Only 22% of Austin homes sell above asking. Offer at or below asking. Request seller concessions (up to 6% FHA, 9% conventional). Ask for repairs. You have leverage — use it.

Step 6: Close (Week 10-14)

Final approval, appraisal, inspection, closing. Austin closing costs: 2-4% of price. Budget $10,900-$21,800 on a $545K home. Texas does not require an attorney for closing.

Buy Your Austin Home in 2026

Buyer's market + DPA programs = best time to buy in years. Compare 50+ lenders now.

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FAQ: Buying a Home in Austin 2026

How much income do I need to buy a home in Austin in 2026?

To buy a median $545,000 home, you need approximately $115,000 with 20% down, $125,000 with 10% down, or $140,000 with 3.5% FHA down. Austin's high property taxes (2.2%) significantly increase the income needed.

Compare lenders: See what you qualify for →

Is Austin a buyer's market in 2026?

Yes. Prices down 2.1% YoY, inventory up 22%, homes sitting 35 days, only 22% sell above asking. This is the strongest buyer's market in Austin in over five years.

Get pre-approved: Compare lenders →

What are the best first-time home buyer programs in Austin?

TSAHC Home Sweet Texas (up to 5% DPA), TDHCA My First Texas Home (5% DPA + 30-yr fixed), FHA 3.5% down, and HomeReady/Home Possible 3% down. Compare all to find the best fit.

Search DPA: Find Texas DPA →

What are the best neighborhoods for first-time buyers in Austin?

Manor ($350K), Buda ($380K), Pflugerville ($395K), Round Rock ($420K), and Cedar Park ($450K). Focus on suburbs north and east of Austin for the best value and schools.

Compare lenders: Get pre-approved →

How much are closing costs in Austin?

Closing costs in Austin range from 2-4% of the purchase price — $10,900-$21,800 on a $545K home. Texas has no state income tax but property taxes are 2.2% in Travis County (among highest in US).

Compare lenders: Find lowest closing costs →

Are Austin home prices dropping in 2026?

Yes. Austin median prices are $545,000, down 2.1% YoY. The market has cooled from the 2022 peak of $575,000. Inventory is up 22%, creating a buyer's market. But high property taxes (2.2%) offset some savings.

Find FHA lenders: Compare FHA lenders →