The wide open spaces and cowboy culture of Texas have long drawn transplants from across the United States. With a booming economy and affordable real estate, the Lone Star State shines bright for investors too. Major metropolitan areas like Dallas, Houston, and Austin grab headlines as top places to live and work. But savvy real estate investors know to also consider emerging markets across Texas offering optimal blends of appreciation potential and cash-flowing returns.
The best cities and towns to buy investment property in Texas combine steady population and job growth with dynamic local investment incentives. Carefully evaluating factors like housing demand against market inventory, rental rates, employment diversity, and infrastructure improvements can lead investors to golden real estate opportunities. While economic turbulence may impact some areas more dependent on oil and gas, Texas overall provides a stable environment for building wealth through property.
This guide explores ideal investment locales across the Texas market. Learn which urban, suburban, and rural hotspots offer the strongest fundamentals today. We will also compare and contrast the largest metro areas of Dallas/Fort Worth, Houston, and red-hot Austin while analyzing important data points for other cities on the rise. Whether you prefer a turnkey single-family rental near a top employer, a multifamily unit in an amenity-rich community, or raw land holding for future upside, Texas delivers options. Read on for what to look for in a Lone Star real estate investment.
Is Texas a Good Place to Invest in Real Estate?
Texas has long been considered one of the best places to invest in real estate in the United States. With booming job markets, rapid population growth, low cost of living, and business-friendly policies, Texas offers prime real estate investment opportunities. When deciding the best cities in Texas to buy investment properties, consider job and population growth, affordability, cash flow potential, development, and infrastructure improvements. Weigh the pros and cons of both major metro areas and up-and-coming secondary markets across Texas.
Where is the Best Place to Buy Land in Texas for Investment?
Rural Texas offers affordable land investment opportunities, especially for agricultural use. Look at Central Texas near major growth zones like Austin and San Antonio for steadily appreciating land values. Areas like Hill Country provide beautiful vistas and recreation appeal too. For hunting land, East Texas and South Texas have abundant wildlife. West Texas offers wide open spaces, but development there remains limited. Evaluate access to transportation, utilities, and proximity to urban centers that bring demand. Raw land can be a smart real estate investment in Texas, but perform due diligence on long-range plans for any location under consideration.
What is the Best City to Invest in Texas?
Major metro areas like Dallas, Houston, and Austin offer strong real estate investment options in Texas. These diverse and growing job centers bring in new residents every day, fueling housing demand. While prices have risen sharply in recent years, these cities still offer relatively affordable buys compared to other major metros nationwide. Investors should focus on purchase price-to-rent ratios, population and job growth, and inventory levels when deciding where to buy. The development of mixed-use communities has also enhanced many urban neighborhoods in Texas.
Besides the big cities, San Antonio, Fort Worth, El Paso, Arlington, Corpus Christi, and Plano are worth considering. The optimal investment city depends on your strategy and target tenant demographic. Balance current returns with appreciation potential. Proximity to entertainment, employers, transit, and amenities impacts value.
Where in Texas has the Best Housing Market?
The Austin housing market ranks among the hottest nationally, with home prices up 48% over 2020. Austin saw the largest net migration of any U.S. city in 2021, driving fierce competition among homebuyers and investors. The city's relative affordability compared to tech hubs like San Francisco draws new residents. Austin's booming economy and job growth – led by Apple, Tesla, Samsung, and Google - bring housing demand. With a limited supply of homes for sale, Austin offers profitable investment opportunities despite relatively high prices.
Dallas, Houston, and San Antonio also make the list of top housing markets. These urban areas feature strong job growth and expanding populations. Ongoing in-migration to Texas fuels real estate across these metros.
Which Texas City is Growing the Fastest?
The Austin metro area leads in population growth among major Texas cities. According to the U.S. Census Bureau, the Austin-Round Rock MSA saw a 3.4% annual increase in 2021. The area added over 60 new residents per day. Major tech industry expansion and affordable cost of living compared to coastal cities drive Austin's surging population.
Aside from Austin, Texas' fastest growing cities are in suburban communities around major metros. New Braunfels, Georgetown, Frisco, McKinney, Conroe, and Denton top the list. These areas combine small-town charm with urban job access. New Braunfels, located between Austin and San Antonio, saw a 7.7% annual population increase. Strong home appreciation and development in these high-growth suburbs make them profitable real estate investment locales.
What Cities in Texas are Up and Coming?
Texas is home to many dynamic cities on the rise as business and cultural hubs. Look to smaller markets with major growth potential for promising real estate investments. Some top-up-and-coming Texas cities include:
- Amarillo – With expanding local employers like Bell Helicopter, Amazon, and Tyson Foods, Amarillo is attracting new residents. Recent downtown revitalization efforts enhance amenities. Home prices remain affordable, averaging just $179,000.
- Killeen – As a hub for the U.S. Army’s Fort Hood, Killeen’s population swells during deployments. New development near the base brings economic growth. Killeen offers relatively low buy-in home prices near $200k.
- San Marcos – Located between Austin and San Antonio along a tech and education corridor, San Marcos is gaining jobs. Home prices average around $300k, while rents rise steadily, making it appealing for investors.
- Waco – Magnolia Market at the Silos drives tourism here. Waco adds amenities while maintaining a low cost of living, attracting remote workers. Investors can still find good inventory under $300k.
- McAllen – This Rio Grande Valley hub gains population from Mexico relocations. Healthcare, education, and retail jobs are growing. Homes cost around $175k, providing opportunity.
Focusing on Texas' up-and-coming cities can help real estate investors get in early with significant upside potential. But be cautious of overbuilding and research local economic health.
What Texas City is Booming?
The city experiencing the most economic and population growth currently is Austin. Major companies like Tesla, Oracle, and Samsung have recently relocated headquarters and operations there. Austin adds around 180 new residents every day, over 65,000 per year. Millennials in particular flock to Austin for its tech jobs, music scene, and outdoor lifestyle. This influx of new residents fuels massive demand for housing. The Austin metro now contains almost 2.3 million people. Infrastructure struggles to keep up, with traffic jams and long commutes common. While growing pains exist, Austin offers perhaps the greatest upside for real estate investors in Texas right now.
Other rapidly booming cities in Texas include:
- Dallas – Adding over 1,200 new residents weekly, Dallas’ metro population now stands at 7.7 million. Financial services and corporate expansions create jobs. Toyota, McKesson, and Uber grow their Dallas footprint. Flourishing neighborhoods like Uptown draw interest. Luxury apartments and mid-rise condos cater to urban professionals.
- Houston – Known for energy, Houston also expands in healthcare, shipping, and technology. Jobs attract new residents, averaging 1,100 per week. The total metro population exceeds 7 million. Ongoing rebuilding from recent storms and floods brings development. Houston still offers relatively affordable single-family homes under $300k in many areas.
- San Antonio – With more residents relocating here from pricier California cities, San Antonio adds over 60,000 new people annually. Major industries and employers include healthcare, military, and hospitality. Historic downtown thrives, with revitalization spreading outward. Real estate near the River Walk and in the Pearl District brings strong investment interest.
The combination of a business-friendly environment, growing job markets, and desirability for newcomers make these Texas cities boomtowns.
What Towns Are Growing in Texas?
While major metros capture many of the headlines, smaller towns across Texas also demonstrate surging population and real estate investment potential. Here are some of the fastest-growing Texas towns:
- Frisco – Part of the expanding North Dallas suburbs, Frisco grew by over 15% in a year. Top employers like the NFL Cowboys, Oracle, and IKEA drive corporate relocations. Excellent schools and family amenities attract residents. New housing starts abound but supply lags demand, benefiting investors.
- New Braunfels – Located between San Antonio and Austin, charming New Braunfels expanded by over 7% last year. Outdoor recreation on the Comal and Guadalupe Rivers draws tourists and residents. Home prices rose 12% but remain affordable around $325k.
- Leander – Another outlying Austin suburb, Leander’s population jumped 22% recently. Home values edge up but buying costs around $415k remain lower than Austin proper. Major tech employers expanded here, including Dell and National Instruments.
- Fort Stockton – In oil-rich West Texas, this small town of just 9000 saw 17% growth. Nearby shale drilling, pipeline projects, and highway expansions bring jobs. Housing inventory is limited but costs under $200k.
Rapidly growing Austin suburbs like Georgetown, Pflugerville, and Kyle also make the list. These smaller communities near top employment centers offer spillover benefits from major metro expansion.
What Part of Texas is Booming?
Central Texas including the Austin-Round Rock, San Antonio, and Killeen metro areas demonstrates perhaps the most dramatic population and economic expansion in the state currently. Home to tech hubs like Austin and agribusiness around San Antonio, Central Texas adds over 1300 new residents daily. This region anchored by two large cities provides diversity in housing options and employment. With development spreading along the I-35 corridor, investment opportunities abound from urban downtowns to new suburban subdivisions. Investors should strongly consider partaking in the Central Texas boom.
The Dallas-Fort Worth Metroplex also sees boom-like growth. As corporate giants such as Toyota, Liberty Mutual, and JP Morgan Chase relocate to North Texas, high-paying jobs come with them. DFW already contains over 8 million residents. Development stretches across Collin, Denton, Dallas, and Tarrant Counties. DFW offers big-city amenities with more affordability than coastal markets.
The dominance of the energy industry makes Houston a perennial boomtown as well. Ongoing recovery from recent storms also brings construction and infrastructure spending. Ports and global trade ensure Houston’s long-term expansion.
Why is Texas Experiencing Booms? Business-friendly policies, no state income tax, and low costs compared to cities like Los Angeles and New York drive relocations to Texas metros and small towns alike. Job and wage growth fuel real estate investment opportunities statewide.
Where is the Best Economy in Texas?
The Austin metro area has the hottest economy in Texas currently. At 4.6%, Austin boasts the lowest unemployment rate among major U.S. metros. Companies large and small flock to Central Texas, drawn by corporate incentives and highly educated talent pipelines. The resulting surge of high-paying tech and professional jobs makes Austin America’s premier “work-live-play” city.
Dallas and Houston also rank highly among the best economies in Texas and nationally. After energy, Dallas’ diversified economy thrives on financial services, aerospace, and telecommunications firms. Houston punches above its weight with 22 Fortune 500 company headquarters, second nationally only to New York City.
What State is Moving to Texas the Most?
According to Texas Realtors data, California leads as the state sending the most new residents to Texas. With sky-high housing costs and state taxes pricing many out of the California dream, Texas provides refuge with more affordability. An estimated 373,000 Californians moved to Texas over the past decade.
Other states with the most relocations to Texas include Florida, Louisiana, New York, and Illinois. People migrate to Texas for jobs, lower costs of living, warm weather, and more space. This inbound migration will continue fueling housing demand and real estate investment potential.
Is Texas Worth Moving to?
Texas remains a top destination for relocations due to thriving job markets, low costs, and a friendly business climate. The state features economic dynamism from energy along with growing tech, finance, and healthcare sectors. Buying a home costs about half as much in Texas compared to California.
New residents are drawn to major metros like Dallas, Houston, and trendy Austin for urban living. Texas's smaller towns and suburbs also attract people seeking space and amenities. With no state income tax and comparatively cheap housing, Texas provides cost savings that add up. The food, music, and culture scenes thrive statewide as well.
While Texas summers get hot and commutes in major cities can grind, the state offers so much opportunity that it remains well worth moving to. Real estate investors should strongly consider buying here while prices still remain comparatively affordable and upside potential abounds. Just research the market carefully and invest wisely.
Is Texas or California Better to Live In?
Weighing the quality of life between Texas and California depends on your priorities. California boasts ideal weather year-round along with mountainous and coastal scenery found nowhere else. Major metros like San Francisco and Los Angeles offer unmatched culture. However, the Golden State suffers from sky-high housing costs, grueling commutes, and high taxes. For families and retirees hoping to afford a comfortable lifestyle, Texas provides balance.
Texas features diversity between major urban centers like Austin, thriving small towns, and wide-open rural spaces. Housing costs half or less what similar California properties command. With no state income tax and lower costs for goods and services, Texas stretches dollars. Texans also enjoy signature barbecue, live music, and arts scenes. Tradeoffs include hot summers and potential natural disasters like hurricanes. For many looking to buy a nice home and enjoy amenities, Texas edges out California on quality of life comparisons.
Is it Cheaper to Live in California or Texas?
Overall, Texas provides substantially lower costs of living compared to California. Housing stands out as the biggest difference. The median home price in California exceeds $800,000, more than double Texas’ median around $375,000. Californians also pay three times more property tax overall than Texans. Costs for utilities, transportation, healthcare, and groceries burden California budgets more.
California levies high state income tax up to 13.3% while Texas has no state tax. Texas residents keep more of their paychecks. Gasoline costs 35% less per gallon in Texas as well. From housing to energy, Texans pay less for everyday expenses, making it generally 40% more affordable to live in Texas versus California.
Why is Texas Better than Other States?
Ask folks who have moved to Texas from other states why they made the switch and common answers include affordability, jobs, and less crowded living. Texas metro areas still offer reasonably priced homes under $300k in many neighborhoods. Even within major cities like Dallas and Houston, house hunters can find value compared to other states. Texas also created over 400,000 new jobs last year, more than any state. With wide open spaces and rural small towns to complement the big cities, Texas provides room to spread out.
Beyond housing and employment, Texas appeals to its culture. Music scenes thrive in Austin, Fort Worth, and elsewhere. World-class museums, cuisine, and arts thrive. The famous "Texas spirit" combines warmth and tenacity. With no state income tax and lower living costs, Texas helps both families and businesses keep more of what they earn. The Texas economy ranks as a global powerhouse on its own, despite energy sector volatility. Taken together, the Lone Star State delivers value, opportunity, and quality of life that other states struggle to match. For both new residents and real estate investors, Texas looks better than the rest.
