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Why Are Houses in Texas so Cheap? 9 Reasons!

Austin, Texas skyline during daytime

If you’ve ever looked at homes in a few different states, you’ve probably noticed that Texas is one of the cheapest states to purchase homes in. Compared to other states nearby, it is extremely inexpensive. You may be wondering why the land in Texas is so much cheaper than it is in other areas, and why the cost of living is generally lower overall.

There are several reasons why homes and land are so cheap when compared with areas like California. Homes in Texas may not be the cheapest in the union, but they are easily on the cheaper side of things.

In this article, we’ll take a look at some of the reasons why Texas is so inexpensive to purchase a home in.

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Why Are Houses in Texas so Cheap? 9 Reasons!

1. Land is Cheaper

Compared to other states, land is much cheaper in Texas than in other areas. Therefore, homes tend to be cheaper as well. After all, when you purchase a home, you are also using the money to purchase the land that the home sits on—when the land is cheaper, then the home will also be cheaper.

Texas has a lot of free land compared to other states. It was developed rather late, which means that much of the land has not been divided up quite as much. Plus, Texas is just big compared to other states. After Alaska, Texas is the biggest state.

gated residential house in Houston, Texas
Image Credit: ArtisticOperations, Pixabay

2. Rural

Most of Texas is rural, where land tends to be a bit cheaper. If you get around the larger cities, land goes up just like it does in every other state. However, because these cities are so few and far between, Texas tends to have a lower home cost overall.

If you’re okay living in a rural area, then you can likely find a house for very cheap. However, most jobs are found in the cities which means that most individuals are going to have to live within commuting distance. Land here will be more expensive since it is in higher demand.

3. No Income Tax

Texas has no income tax, on top of having very low taxes overall. Because taxes are extremely low, the costs of owning a home are lower as well. The overall cost of living is much lower, which also means that you’ll get more bang for your buck when it comes to housing.

The fees for owning a home are also quite inexpensive, which further drops the cost of homeownership. When you consider things like property taxes, you’ll find that owning a home is probably even cheaper than you would have originally considered.

4. Cheaper Labor

The labor necessary to build a house is also much cheaper in Texas than it is in other states. For one, this is because of the lower cost of living. Workers don’t need as much money to live comfortably simply because everything is cheaper. The lack of an income tax greatly helps this matter, as well.

Homes don’t have as high of a labor cost wrapped into them, making them much cheaper overall. However, this lower wage also means that housing is comparably expensive. While the actual cost of the house is lower, it isn’t necessarily when you compare it to the average income in the area.

bricked residential house in Houston, Texas
Image Credit: ArtisticOperations, Pixabay

5. Fewer Restrictions

Overall, there are fewer building restrictions and codes in Texas. This allows builders to get things done for cheaper, which makes homes less expensive. Plus, there are also fewer fees you have to pay during the building process, which also helps keep things more affordable.

The more licenses a builder needs to complete a house, the more that house is going to cost. Because Texas has fewer of these licenses, builders can spend their money on the house—not on buying more licenses and paying to get around zoning laws.

Of course, fewer codes can also mean that houses are lower-quality than they are in other areas. However, this isn’t necessarily the case, depending on what you think of the building codes in other areas.

6. Fewer “High Cost” Areas

Some places are simply going to cost more to live in. For instance, beaches are often more expensive to live on in general. Places with more views are also more expensive since land with a view is less common. People tend to compete for the best views in these areas, which drives prices up.

However, in Texas, very few of these places exist. There are few sought-after beaches and no mountains to speak of. Much of Texas is rather the same and quite boring. There is no reason to seek a single piece of land since there is likely a similar piece a few miles down the road.

In the end, this isn’t a completely bad thing, since it also means that prices are less expensive.

7. Low Rental Costs

According to the Texas real estate investment statistics, rental costs are relatively lower in Texas. With rental costs so much cheaper, many people decide to stay in their rental for longer. They aren’t itching to get out of them and into a cheaper home.

When rental payments are often cheaper than buying a home, many people hold off on the purchase to save money. When fewer people are looking for homes, the price drops—the less demand for the home, the lower the cost of a home.

Of course, this also depends on the area. In some larger cities, rentals are a bit more expensive. However, so are housing costs, so renting may still be a cheaper option.

apartment complex in Houston, Texas
Image Credit: ArtisticOperations, Pixabay

8. Construction Materials Are Easy to Find

Many construction materials are abundant in Texas, making them easy to get ahold of. Because supply is very high, the cost of these materials is very low. Therefore, the cost of a home is going to be lower as well.

For instance, both sand and stone are quite easy to find, and both of these materials are used abundantly on houses.

Because these materials are available locally, you also don’t have to have them shipped in, which can potentially save builders quite a bit of money. Cheap, locally-sourced materials can make all the difference when it comes to house costs.

9. Moderate Climate

Texas can get quite hot, there is no denying that. However, Texas does have a pretty moderate climate overall. Therefore, houses can be built without taking into account things like tornadoes and extra winter weather.

Because builders can safely skip over these extras, homes are much cheaper than they are in other, disaster-prone areas. Of course, there are some expectations to this rule. Homes alongside the gulf may have hurricane-proofing—just in case.

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Homes in Texas are a bit cheaper than they are in other areas. There are a few forces driving this trend. Firstly (and mostly), land tends to be much cheaper than in other areas because there is just so much of it. Because less of the land is developed, there is still plenty of places to put a house. People aren’t fighting over a few plots, which keeps the cost low.

Secondly, homes are also much cheaper to build. Workers don’t require as much money since the cost of living in the state is low. Many materials can be sourced locally for very cheap, and there aren’t many fees the builders have to pay to the state.

Finally, the cost of owning a home is also lower. There aren’t as many fees and taxes, for instance.

Featured Image Credit: justraveling, Pixabay

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