Investment in Austin TX

Top Destination

Austin, Texas is a top destination for real estate investors. Here are some reasons why:

• Rental market: Austin's rental market is one of the fastest-growing in Texas. The area has an average monthly rent of $2,000 and is made up mostly of single-family homes, which means more renters and higher rents.

• Population growth: Austin is one of the fastest-growing metro areas in the United States, and population growth is expected to continue for the next 14 years. This means a growing demand for housing.

• Tax climate: Austin has a favorable tax climate.

• Economy: Austin has a booming economy.

• Land: The influx of people and the available land make Austin a good market for single-family home rentals.

• Office market: Austin's office market is benefiting from corporate relocations and expansions.

• Rental income: The influx of highly paid tech employees competing for housing will push rental prices up. 

The city has a favorable tax climate, a strong rental market, high population growth, and a booming economy. So, if you're looking for the best city to invest in rental property, Austin is the place to be.

Tax Climate

The tax climate of a state is a measure of how well its tax system is structured. It helps policymakers, business leaders, and taxpayers compare their states' tax systems. 

In 2021, the average total state and local taxes per person in Austin, Texas, was $4,861, which is 23% less than the national average. Texas has low state and local taxes relative to income, with $81 per $1,000 of personal income, compared to the national average of $99 per $1,000. 

Austin has a few tax-related features that may contribute to its tax climate:

• No state income tax

• Austin does not have a state income tax. This is one of the main reasons people move to Texas.

• Low sales tax

• Austin's sales tax is 8.25%, which includes a 6.25% state tax, 1% city tax, and 1% metro transit authority tax.

• Homestead exemption

• Texas offers homeowners a property tax break in the form of homestead exemption, exempting $25,000 or more from their overall taxes. Those aged 65 and older or disabled can claim an extra amount worth $10K exempted as well.

Note that this kind of Tax Climate attracts people move to Austin TX. This has nothing to do with the high property tax rate in Texas which is still a burden on the property owners.