Renting vs Buying in Central Texas: The Real Numbers

I talk to people every week who tell me they can't afford to buy a home. I get why it feels that way — home prices look intimidating. But most of the time, when we actually sit down and look at the numbers, they're surprised at how close their rent is to a mortgage payment on a brand new house.

So let's just look at the numbers. No sales pitch, just math.

What You're Paying in Rent Right Now

According to Apartments.com, the average one-bedroom in Austin runs $1,439/month. A two-bedroom? $1,844. Nicer spot or closer to downtown, you're clearing $2,000 easy. Zillow puts the Austin average across all sizes at $2,095.

That's $17K-$25K a year going to your landlord. Over five years? You're looking at $85K to $125K gone. You don't build equity. You don't get tax benefits. You move out with nothing.

And here's something worth noting: Austin rents dropped from their 2022 peak — down about 17% — but vacancy rates are already at 9.9%, the highest on record. When that supply gets absorbed, rents climb back up. That dip won't last forever.

What a New Home Actually Costs

Right now DR Horton is offering a 3.99% rate buydown. That makes a huge difference in what your monthly payment looks like.

A 3-bed, 2-bath in Sunset Oaks starting around $281K — with FHA at 3.99%, 3.5% down, taxes and insurance included — you're looking at roughly $1,800-$1,900 a month. That's what a lot of people are paying in rent right now.

Need more room? A 4-bedroom in Paramount starting at $365K comes out to about $2,700-$2,800 a month. Brand new home in Kyle, garage, yard, plenty of space. And you're building equity every month instead of paying someone else's mortgage.

And if you qualify for down payment assistance, you might not need much cash to close at all. Some of those programs are forgivable grants — free money that you never pay back.

The Part Nobody Talks About: Equity

Here's the thing. Every mortgage payment you make, part of it goes toward paying down what you owe. That's equity. That's yours.

On a $280K home with FHA at 3.99%, you'll pay down roughly $26,000 in principal in the first five years. You haven't done anything special — you just lived in your house instead of an apartment.

Five years of renting at $1,800/month? You've spent $108,000 and built zero equity. That's the real cost of waiting.

What About Taxes, Insurance, All That?

Yeah, owning a home has costs that renting doesn't. Property taxes, insurance, maintenance. But here's why new construction is different:

Maintenance is basically nothing for years. Everything is brand new. Everything is under warranty. DR Horton gives you a 10-year structural warranty. Your HVAC, appliances, roof — all new. You're not inheriting someone else's problems.

Utility bills are lower. New homes are built to current energy codes. Better insulation, better windows, efficient HVAC. Your electric bill in a new build is noticeably less than in an older home.

Taxes and insurance are already included in the payment numbers above. What you see is what you pay.

Bottom Line

I'm not going to tell you buying is right for everybody. But if you're paying $1,500 or more in rent and you haven't at least looked at what you'd qualify for, you're probably leaving money on the table.

The numbers might surprise you. They usually do.

Communities with Payments Comparable to Rent

Check out these communities where monthly payments often match what you're paying in rent:

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