15 Cheapest Places to Live in Texas by Property Tax Rate (2026)

15 Cheapest Places to Live in Texas by Property Tax Rate (2026)

Texas is one of the most affordable states in the country - until your property tax bill arrives. With no state income tax, local governments lean heavily on property taxes. The state average effective rate lands between 1.60% and 1.80%, well above the national average.

That means the cheapest city to buy a home isn't always the cheapest city to own one. A low sticker price with a high tax rate can cost you more over time than a pricier home in a low-tax county.

We ranked 15 Texas cities by what actually hits your wallet each year: estimated annual property taxes, calculated as median home value × effective tax rate.

Key Takeaways

• San Angelo has the lowest estimated annual property tax bill ($2,242) thanks to Tom Green County's 1.13% effective rate
• Texarkana has the cheapest home prices ($131,086) but a 2.05% rate pushes its annual tax bill above several more expensive cities
• Midland costs $291,000+ to buy, yet its 1.15% rate produces a lower annual tax bill than Abilene, where homes cost $100,000 less
• Cameron County (Brownsville and Harlingen) offers a rare combination of low home prices and below-average tax rates
• Over 30 years, choosing a low-rate city over a high-rate city can save you $10,000–$60,000 in property taxes alone

How We Ranked These Cities

Most "cheapest places to live" lists sort by home price alone. That's only half the picture in Texas.

We used a simple formula:

Estimated Annual Property Tax = Median Home Value × Effective Tax Rate

• Median home values come from Zillow's typical home value index (February 2026)
• Effective tax rates come from Ownwell and county tax records, reflecting what homeowners actually pay after exemptions
• Cities are ranked by their estimated annual property tax bill, lowest to highest

This approach captures the true annual cost of homeownership from a property tax perspective. A city with $200,000 homes and a 1.1% rate costs less each year than a city with $130,000 homes and a 2.2% rate.

The 15 Cheapest Places to Live in Texas

1. San Angelo - $2,242/year

San Angelo tops our list thanks to Tom Green County's exceptionally low 1.13% effective tax rate - well below the state average. The city of about 100,000 in West Central Texas has a diversified economy anchored by healthcare, education (Angelo State University), and the Goodfellow Air Force Base. Cost of living runs roughly 10% below the national average across the board.

2. Brownsville - $2,509/year

Located at the southern tip of Texas in the Rio Grande Valley, Brownsville pairs low home prices with a below-average effective tax rate. Cost of living runs roughly 20% below the national average, with affordable groceries, utilities, and healthcare. The city also benefits from cross-border commerce and a growing SpaceX presence at nearby Boca Chica.

3. Harlingen - $2,591/year

Harlingen is one of the most affordable cities in Texas by nearly every measure. Its cost of living is almost 30% below the national average. While its tax rate sits near the state average, the low home values keep annual bills manageable. The Rio Grande Valley location provides access to affordable goods and services, and Valley International Airport offers direct flights to several major cities.

4. Texarkana - $2,687/year

Texarkana has the lowest home prices on this list by a wide margin - but its 2.05% effective rate is among the highest. The result: an annual tax bill that's higher than three cities with more expensive homes. Still, it cracks the top five because the home values are that low. Straddling the Texas-Arkansas border, Texarkana offers a small-city feel with big-box retail and healthcare options.

5. Wichita Falls - $3,160/year

Consistently ranked as one of the cheapest places to live in Texas overall, Wichita Falls offers a cost of living about 10% below the national average. The economy is anchored by Sheppard Air Force Base, healthcare, and manufacturing. The 1.90% rate is slightly above average, but home prices under $170,000 keep the bottom line low.

6. Laredo - $3,303/year

Laredo is one of the busiest international trade crossings in the Western Hemisphere, and that economic activity helps keep residential tax rates below the state average. Home values sit around the $213,000 mark, and the 1.55% effective rate puts annual tax bills well under the statewide median. The city has a strong cultural identity and a cost of living significantly below national averages.

7. Midland - $3,351/year

Midland is the most expensive city to buy on this list - but one of the cheapest to own. Midland County's 1.15% effective rate is among the lowest in the state, recently reduced by 8%. The Permian Basin oil-and-gas economy drives higher home prices, but if you can afford the purchase price, your annual tax bill will be lower than in many cities that cost $100,000 less. It's a textbook example of why you should look beyond the price tag.

8. Corpus Christi - $3,460/year

A Gulf Coast city with beaches, a naval air station, and a major port, Corpus Christi's 1.58% effective rate keeps it just below the state average. The cost of living is moderately below national benchmarks, and the city offers more amenities and recreation than most cities on this list. For buyers who want coastal living without coastal tax bills, it's worth a look.

9. Odessa - $3,636/year

Odessa is Midland's neighbor in the Permian Basin, but with more moderate home prices and a slightly higher tax rate. The economy is heavily tied to oil and gas, which creates boom-bust cycles in the housing market. At $3,636 per year, the property tax bill stays manageable, and the city offers a lower barrier to entry than Midland for buyers looking at the West Texas energy corridor.

10. Killeen - $3,720/year

Adjacent to Fort Cavazos (formerly Fort Hood), one of the largest military installations in the world, Killeen offers a stable, military-driven economy with housing prices far below nearby Austin. The 1.64% effective rate is close to the state average, and Bell County provides a solid mix of affordability and access to Central Texas.

11. Amarillo - $3,759/year

The gateway to the Texas Panhandle, Amarillo offers a cost of living 6–8% below the national average with a diversified economy in agriculture, energy, healthcare, and logistics. The blended effective rate across Potter and Randall counties sits around 1.92%. Home prices under $200,000 keep annual tax bills under $4,000, though the rate itself is above average.

12. Lubbock - $3,908/year

Home to Texas Tech University, Lubbock (a.k.a. "Hub City") has living costs about 8% below national levels. The 1.86% effective rate is slightly above average, but home values just over $210,000 keep annual bills under $4,000. The economy is anchored by education, healthcare, agriculture, and the energy sector.

13. El Paso - $4,103/year

El Paso's cost of living runs 15% below the national average, making it one of the most affordable large cities in the state. The 2.00% effective rate is above average, which pushes the annual tax bill past $4,000 despite moderate home prices. Fort Bliss and cross-border trade with Ciudad Juárez drive the local economy.

14. McAllen - $4,136/year

McAllen's overall cost of living is 19% below the national average - one of the most affordable metro areas in the entire U.S. However, Hidalgo County's 1.94% effective rate is above average, which offsets some of the housing savings. The city has a strong healthcare and retail economy boosted by cross-border trade with Reynosa, Mexico.

15. Abilene - $4,209/year

Abilene has a cost of living about 10% below the national average, with housing costs 25% cheaper than the U.S. median. But Taylor County's 2.22% effective rate - the highest on this list - eats into those savings. Home to three universities and Dyess Air Force Base, Abilene offers solid amenities but the highest annual tax bill of any city in our ranking, despite having one of the lower home prices.

All 15 Cities at a Glance

Texas Counties With the Lowest Property Tax Rates

If you're flexible on location, choosing a low-tax county can make a bigger difference than choosing a cheap city. Here are the Texas counties with the lowest effective property tax rates:

Most of Texas's lowest-tax counties are extremely rural with limited housing markets. For buyers who want real amenities, Tom Green County (San Angelo) and Midland County offer the best combination of low rates and livable cities.

The Price Tag Trap: Why Home Price Alone Is Misleading

The data reveals a counterintuitive pattern: buying a cheaper home in Texas can actually cost you more in property taxes.

Example 1: San Angelo vs. Texarkana

• Texarkana home: $131,086 → annual tax of $2,687
• San Angelo home: $198,398 → annual tax of $2,242
• San Angelo costs $67,000 more to buy but $445 less per year in taxes
• Over 30 years: $13,350 saved in property taxes by choosing the more expensive city

Example 2: Midland vs. Abilene

• Abilene home: $189,603 → annual tax of $4,209
• Midland home: $291,378 → annual tax of $3,351
• Midland costs $102,000 more to buy but $858 less per year in taxes
• Over 30 years: $25,740 saved in property taxes

The takeaway: always factor in the effective tax rate before you decide where to buy. A low purchase price with a high tax rate is a recurring annual cost that compounds over the life of your mortgage.

How to Lower Your Property Taxes Wherever You Live in Texas

No matter which city you choose, you have the right to protest your property tax assessment every year. Here's how to keep your bill as low as possible:

File a Homestead Exemption

If this is your primary residence, file for a homestead exemption with your county appraisal district. In most Texas counties, this removes at least $100,000 from your taxable value for school district taxes, and many cities and counties offer additional exemptions. This is free money - there's no reason not to file.

Protest Your Assessed Value

Your county appraisal district sets your property's value every year. If they set it too high, you pay too much. Filing a protest is free and you have nothing to lose - your value can't go up as a result of your protest.

Evidence that supports a lower value includes:

• Recent sales of comparable homes that sold for less than your assessed value
• Photos of property damage, deferred maintenance, or negative features
• An independent appraisal showing a lower market value
• Unequal appraisal data showing similar homes are valued lower than yours

Work With a Property Tax Protest Firm

If you don't want to navigate the process yourself, a professional protest firm can handle everything for you - from pulling comps to representing you at hearings. Most firms, including Ballard Property Tax Protest, work on a contingency basis, meaning you only pay if they save you money.

Understanding how Texas property taxes work is the first step toward making sure you're not paying more than your fair share.

FAQ

What is the cheapest city in Texas to buy a house?

By median home value, Texarkana ($131,086) has the lowest home prices among mid-sized Texas cities, followed by Harlingen ($160,916) and Wichita Falls ($166,341). But if you factor in annual property tax costs, San Angelo is the cheapest city to own a home in, with an estimated annual property tax bill of just $2,242 - the lowest on our list - despite a higher purchase price.

Which Texas county has the lowest property taxes?

Kenedy County technically has the lowest property taxes in Texas (near 0%), but it has fewer than 400 residents and virtually no housing market. For practical purposes, Terrell County (0.67% effective rate, $285 median annual tax) is the lowest-taxed county with measurable collections. For buyers who want an actual city with amenities, Tom Green County (San Angelo, 1.11%) and Midland County (1.15%) offer the lowest rates with livable communities.

Are property taxes in Texas higher than other states?

Yes. Texas has the 7th-highest effective property tax rate in the United States, averaging around 1.60–1.80%. This is largely because Texas has no state income tax, so local governments depend more heavily on property taxes to fund schools, roads, and public services.

Can I lower my property taxes after I buy?

Absolutely. Every Texas homeowner has the right to protest their assessed value each year. Filing a homestead exemption, protesting overvaluations, and working with a property tax protest firm are all effective strategies. Many homeowners save hundreds or thousands of dollars annually through the protest process.