Cost of Living in Houston, TX: Guide to Houston Living Expenses

If you’re looking for a hometown that's affordable, modern, and full of character, look no further than Houston, TX. This vibrant city is famous for its lively culture, diverse communities, and robust job market. If you're considering moving to this city, it's essential to consider the cost to live in Houston, Texas, and how it will affect your lifestyle. Our guide breaks down Houston’s living expenses, from housing and groceries to transportation, healthcare, utilities, taxes, and even recreation, all so you can make an informed choice about your potential new home.

Summary:

• Cost of Living in Houston, TX

• Comparing Average Home Prices and Rent Costs in Houston

• Other Living Expenses in Houston, TX

  • Grocery Shopping and Dining Out in Houston

  • Transportation Options and Fuel Costs in Houston

  • Healthcare and Insurance Costs in Houston

  • Utilities, Internet, and Phone Expenses in Houston

  • Tax Rates in the Houston Area

  • Recreation Costs in Houston, Texas

• Average Salary in Houston

• Tax Benefits for Homeowners in Houston

• Houston Home Prices by Neighborhood

Cost of Living in Houston, TX

Is Houston an expensive place to live? Compared to other big cities, the average cost of living in Houston, Texas, can be a welcome relief. With a more budget-friendly lifestyle, the average living cost in Houston is just 1% higher than the state average and an incredible 7% lower than the national average, according to the C2ER’s® September 2023 Cost of Living Index data. 

In October 2023, Numbeo® reported that the average monthly cost of living in Houston for a family of four is $5,275.80, and a single person’s estimated monthly costs are $1,473.6 (neither figure includes rent).

With regard to housing, Houston stands out as a city that blends affordability with luxury. RentCafe® finds housing costs are a staggering 17% cheaper than the U.S. average as of September 2023, which means you could secure your dream home without breaking the bank.

However, it's important to note that the cost of living in Houston, Texas, can vary from one neighborhood to another. If you're aiming for luxurious living, it does come with a higher price tag. For example, an upscale neighborhood like Piney Point has a median home price of $2.5M, according to Zillow® as of October 2023. 

In contrast, Zillow® points to Downtown Houston as a more affordable choice, with a median home price of just under $382K and $1,799 average monthly rent. 

In Houston, you have the flexibility to embrace the lifestyle that suits you best while benefiting from a cost of living that's notably lower.

Comparing Average Home Prices and Rent Costs in Houston

The real estate market in Houston offers a wide range of options to suit different budgets, from a mix of single-family homes to townhouses and apartments in various neighborhoods. The city caters to established families, couples without children, young professionals, and retirees.

The average home price in Houston can vary significantly based on your preferred area. While upscale neighborhoods like River Oaks boast high-end properties, you can also find more affordable options in areas like Spring or Sugar Land. On average, a single-family home in Houston has a median home price of around $383,333, as reported by C2ER® in September 2023, though exact prices depend on location and features.

Other Living Expenses in Houston, TX

Understanding the broader scope of Houston living expenses is necessary for your financial planning. Let's explore the price of living in Houston, Texas.

Grocery Shopping and Dining Out in Houston

Whether you prefer upscale restaurants, food trucks, or local favorites, the dining in Houston is ample and diverse. For instance, a dinner for two at a mid-range restaurant generally costs an average of $90, as reported by Numbeo® in December 2023.

As for groceries, Houston offers several options, from high-end stores to budget-friendly supermarkets. Some staple grocery costs you can expect include milk at about $2.75, a dozen eggs cost roughly $2.76, and a pound of potatoes runs around $3.54.

Transportation Options and Fuel Costs in Houston

Houston is a city of cars, which buzz along a busy network of streets, and gas prices won't break the bank. Per Numbeo®, a gallon of gas averages about $3.44 as of December 2023. However, Houston is beginning to embrace public transportation, providing new possibilities for car-free commuting.

Healthcare and Insurance Costs in Houston

In Houston, you have access to a quality healthcare system. Health insurance can be pricey, so keep that in mind when planning your budget, and the actual cost of medical services depends on your needs. To give you an idea, here are some average healthcare costs according to the latest data from The Cost of Living Index C2ER® in September 2023:

• Routine check-ups with healthcare professionals, including optometrists and dentists, cost approximately 6% less than the U.S. average. A doctor’s visit can cost about $98. 

• A comprehensive optometry check-up is around $105.93.

• Dental appointments, essential for oral health, come in at an average cost of $114.37. 

Utilities, Internet, and Phone Expenses in Houston

RentCafe® reports that energy costs average $175.70 per month as of September 2023. Numbeo® finds that a typical monthly bill for internet averages $96, and monthly phone services run approximately $90 in December 2023.  

Tax Rates in the Houston Area

Texas is known for having no state income tax, which can be a significant financial benefit. However, it's important to note that local property and sales taxes can vary based on your location. You can expect an average sales tax of 8.25% in 2023, combining the state rate of 6.25% with varying local rates, according to the Texas.gov website.

Recreation Costs in Houston, Texas

Houston offers abundant recreational opportunities, from parks and cultural attractions to sports and entertainment. The cost of recreational activities can vary widely, but many are affordable. Here are a few standard recreational costs in Houston:

• State Park Pass: One pass is $70 per person, with a second pass costing $25 for another household member.

• Houston City Pass: A $68 pass gives you free entry to Space Center Houston®, plus a choice of four more attractions, such as the Museum of Fine Arts and the Houston Zoo. 

• NASA Johnson Space Center: For $45, you can enjoy an immersive and educational space exploration experience, allowing visitors to discover the wonders of space and NASA's groundbreaking missions.

• Houston Zoo: A captivating and conservation-focused destination, the Houston Zoo is where you can encounter a diverse array of animals from around the world for just under $30 per person.

• Minute Maid Park: Catch a ball game for around $63 per person at the home of the Houston Astros.

Average Salary in Houston

When you're thinking about the cost of living in Houston, one key question is, what salary do you need to live in Houston? Houston has lots of different types of jobs in industries like energy, health care, and technology. The city's economy is strong, which means it's a great place for professionals.

According to RentCafe®, as of September 2023, the median salary in Houston, TX, is $56,019, but high-demand professions may offer even more. Also, Houston's lack of state income tax can help you keep more of what you earn, making it an appealing destination for those looking to boost their financial stability.

Tax Benefits for Homeowners in Houston

If you're considering buying a home in Houston, several tax benefits can work in your favor. Texas, in general, doesn't impose a state income tax, which can be a substantial financial advantage. Furthermore, homeowners in Houston can benefit from property tax exemptions, including:

• Homestead exemption: This exemption reduces the taxable value of your primary residence and can lead to significant savings on your property tax bill, according to MortgageMark® (August 2023).
  

• Mortgage interest deduction: Many homeowners can benefit from deducting their mortgage interest payments from their taxable income, according to Forbes (June 2023). The specific amount you can deduct depends on the size of your loan.

• Property tax deduction: According to Nerdwallet® in January 2020, whether you pay property taxes through an escrow account or directly to your municipality, these expenses are deductible and provide potential tax savings, though the specific amount you can deduct may be limited

• Private mortgage insurance (PMI) deduction: If your loan is less than 20% of your home's value and you have PMI, you may be eligible to deduct PMI payments based on your adjusted gross income (AGI), as reported by Forbes® in June 2023.

• Home equity debt interest deduction: Homeowners using a home equity loan for "buying, building, or substantially improving the taxpayer's home that secures the loan" can deduct the interest payments, as reported by Nerdwallet® in January 2020.
  
  

• Home office expense deductions: In June 2023, Forbes® reported if you use part of your home exclusively for work, you may qualify for deductions related to home-office expenses, providing financial relief for remote work costs.

Houston Home Prices by Neighborhood & Suburb

Houston's real estate market is diverse, and finding the perfect neighborhood to call home includes navigating housing costs. Here are some of the most popular Houston neighborhoods and suburbs, offering you a glimpse of what you can expect regarding home prices:

• Midtown/Montrose: These are two of Houston's most dynamic and sought-after neighborhoods, known for their vibrant arts and culture scene. They offer a mix of historic and modern homes, and you can find properties starting in the upper $200Ks. Nearby communities include Arabella on the Prairie and Valencia.
  
  

• Pearland: A suburb south of Houston, Pearland offers a friendly atmosphere, quality schools, affordable housing, and proximity to the Texas Medical Center. Properties in Pearland start in the upper $200Ks in nearby communities like Arabella on the Prairie and Valencia.

• Sugar Land: This friendly Houston suburb in the southwest metro area offers spacious homes and a wide range of both family and individual activities, community events, and access to quality schools, making it a dream destination for households. Homes near Sugar Land start in the upper $200Ks and can be found in nearby communities like Arabella on the Prairie and Valencia.
  
  

• The Woodlands: A 28,000-acre forested paradise north of downtown, The Woodlands offers modern living complete with outdoor activities, quality schools, and accolades as the #1 city to buy a home in the U.S in Niche.com’s 2023 ranking. Nearby communities include Mavera, Rosehill Lake, and Ellerden where homes start in the upper $200K to low $300K range.
  
  

• Katy: A charming city 30 miles west of Houston, Katy combines small-town allure with big-city conveniences, featuring beautiful neighborhoods, master-planned communities, and a highly regarded Katy Independent School District for households with school-age children. Properties in Katy start in the mid $300Ks in communities nearby, such as Katy Court, Sunterra, and Elyson.
  
  

• Cypress: Roughly 25 miles northwest of downtown, Cypress provides a peaceful suburban lifestyle with easy city access, making it one of Houston's largest suburban communities. Communities like Rosehill Lake, Montgomery Bend, and Ellerden are nearby, offering homes in the upper $200K to low $300K range.
  
  

• Uptown/Galleria: This area is the epitome of urban living in Houston, boasting high-end boutiques, renowned restaurants, and captivating cultural attractions in one of the city's best neighborhoods. Properties near Uptown/Galleria start in the upper $200Ks in nearby communities like Arabella on the Prairie and Valencia.
  
  

• Friendswood: This historic suburb, just south of Houston, offers a unique blend of traditional and modern living, making it the perfect destination for those seeking new construction homes in a culturally significant neighborhood. Explore properties near Friendswood in communities nearby, such as Valencia.

Conclusion

The standard of living in Houston, Texas, offers an economical, well-rounded lifestyle. Houston’s living costs are 7% below the national average, and housing costs are 17% lower, making it an attractive destination. The real estate market provides housing options to suit various budgets and lifestyles, with neighborhoods like Midtown/Montrose, Pearland, and The Woodlands offering homes in the upper $200Ks. Plus, the absence of a state income tax is a financial advantage. 

Enjoy Houston's diverse neighborhoods and suburbs and find your ideal home in this budget-friendly city.

Explore new construction homes in Houston, Texas, today or browse more Pulte blogs. 

Written By: Jordan Thomson, Orange County-based Freelance Writer

Last Updated: 3/29/2024