There is no income tax here, and the house pays instead

What buying in Austin actually involves

The property tax is the largest cost of owning here after the mortgage, and it is worked out unit by unit. A house in the City of Austin and Austin ISD pays five: Travis County, the City, the school district, Austin Community College and Central Health, the county's hospital district, and their 2025 rates add to 2.046485 per $100 of value. Each takes a homestead exemption off first, the school district a flat $140,000 and most of the others 20%, so on the $560,000 median house an owner who lives in it pays about $9,019 a year and a landlord about $11,460. The exemptions are not automatic: you apply to the Travis Central Appraisal District, and in the year you buy you get a prorated one only if the seller had none.

The value the rates are charged on is set every year, and every spring the appraisal district mails a notice of it. An owner has until 15 May, or 30 days after the notice arrives if that is later, to protest, and in 2025 the district took 210,038 appeals. On a homestead the taxable value may rise no more than 10% a year once the owner has held the exemption for a year, and the cap ends with the sale, so a buyer is taxed on the full value from the first bill and the seller's bill understates the buyer's. The rates move too. State law makes a Texas city, county or school district ask its voters before it raises more than a set increase in revenue from the property it already taxes, a limit the Texas Property Tax Reform and Transparency Act of 2019 cut from 8% to 3.5% of operating revenue for most cities and counties, with an automatic election above it, and Austin's have asked. Austin ISD's and Travis County's passed in November 2024. The City's, Proposition Q, failed in November 2025, and the City cut its rate back to the 0.524017 per $100 the law allowed without one.

The ground under the house matters more here than in most cities on this site. The Balcones Escarpment runs roughly along MoPac: west of it the city is hilly, on hard limestone, and east of it flat, on younger rock that includes clays, and along I-35 the Blackland Prairie's clay soils swell when wet and shrink when dry, which cracks foundations built on them. The creeks flood, and since November 2019 the City has regulated building to FEMA's 500-year floodplain rather than the 100-year one, while it redraws its maps on the heavier rainfall of NOAA's Atlas 14 study. A lender's flood insurance requirement follows FEMA's 100-year zone, so an address can be inside the City's floodplain and outside the one a lender checks. A structural engineer and both maps belong before the offer, not after it.

Austin Energy and Austin Water are City departments, so an owner inside the limits cannot shop for electricity the way most Texans can, and the trash, drainage and street fees come on the same bill, set in the City's budget each August. Outside the older neighborhoods the other recurring costs are private: close to half of Austin's owners pay an association fee, and beyond the full-purpose limits much new housing also pays a municipal utility district's tax on top of the county's. Inside the core, the City's HOME amendments of December 2023 and May 2024 let up to three homes stand on most single-family lots and cut the minimum lot size, which has made the land itself a large part of what an older house sells for.

Moving to Austin: check these before you commit

• The appraisal district's value for the house, and what the 10% homestead cap has done to the seller's bill, since the cap ends on the sale
• Whether the address is inside the City's full-purpose limits, which county and school district it is in, and whether a municipal utility district taxes it too
• The City's floodplain map and FEMA's for the exact address, and how far the nearest creek is
• A structural engineer's look at the foundation, east of MoPac above all, and any record of past repairs
• The association's covenants, fee and reserve, and whether a historic district or the City's HOME rules govern what can be built on the lot