Every relocation guide tells you Texas is cheaper. That's mostly true — but not universally true, and the details matter. Texas property taxes are higher. Homeowner's insurance is higher. Summer electricity bills can be brutal. If you're making a $1 million decision about where to live, you deserve numbers, not narratives.
This page is built for people who want to see every line item laid out honestly. We compare real median prices, actual tax rates, published insurance data, and sourced utility costs. Where Texas costs more, we say so. Where the savings are real, we show you exactly how much.
At a Glance: Where Each State Wins
Texas Wins On
- State income tax (0% vs up to 13.3%)
- Home prices and what your money buys
- Gasoline ($2.95 vs $4.75/gal)
- Electricity rates ($0.14 vs $0.32/kWh)
- Groceries (5–10% below national avg)
- Vehicle registration and fees
- Childcare costs
California Wins On
- Property tax rates (Prop 13 caps at ~1%)
- Homeowner's insurance premiums
- Summer cooling costs (milder coastal climate)
- Earthquake coverage availability
1. Housing — What Your Money Actually Buys
The most consequential number in any relocation is what you pay for shelter. In California's coastal markets, the median buyer pays dramatically more per square foot and receives less land, less space, and often older construction. In the Texas Hill Country, those same dollars buy substantially more home on substantially more land.
Median Home Prices: Side by Side
| Market | Median Home Price (2025) | Price per Sq Ft | Typical Lot Size |
|---|---|---|---|
| San Francisco Bay Area | $1,350,000 | $850 – $1,100 | 0.1 – 0.25 acres |
| Los Angeles Metro | $950,000 | $650 – $850 | 0.1 – 0.3 acres |
| Sacramento Metro | $525,000 | $375 – $450 | 0.15 – 0.3 acres |
| Boerne, TX | $425,000 – $550,000 | $210 – $230 | 0.5 – 2+ acres |
| Fair Oaks Ranch, TX | $475,000 – $650,000 | $220 – $240 | 0.5 – 5+ acres |
| San Antonio, TX | $295,000 – $380,000 | $175 – $205 | 0.15 – 0.5 acres |
What Does This Mean in Practice?
A 3,200 sq ft home on a one-acre lot in Boerne that sells for $475,000 would cost $1.4 million to $1.8 million in a comparable Bay Area suburb — if a comparable property existed at all. In the Bay Area, $1.4 million typically buys a 1,600 sq ft condo or a modest 1,400 sq ft ranch on a 5,000 sq ft lot.
The price-per-square-foot gap is the clearest measure: you get 3× to 5× more home per dollar in the Hill Country compared to coastal California.
2. Property Taxes — Where Texas Costs More (and Why It Still Adds Up)
Let's be direct: Texas property tax rates are higher than California's. This is the most common surprise for relocators, and any guide that glosses over it isn't being honest with you.
California's Proposition 13 caps your assessed value at the purchase price and limits annual increases to 2%. Texas requires appraisal districts to reappraise property at least once every three years at or near full market value, but qualifying residence homesteads generally receive a 10% annual cap on increases in appraised value (plus new improvements). Non-homestead properties valued at $5 million or less currently qualify for a temporary 20% appraisal increase cap (expiring December 31, 2026 unless the legislature extends it); properties above $5M receive no cap. The result: Texas combined tax rates of 1.8% to 2.7% versus California's 1.0% to 1.2%.
Why It Doesn't Tell the Whole Story
The rate is higher, but the base is dramatically lower. A $425,000 home in Boerne at a 2.0% combined rate generates roughly $8,500 before exemptions. A $1.2 million Bay Area home at California's 1.1% combined rate generates about $13,200. The Texas bill is lower in absolute dollars even at twice the rate — because the home costs one-third as much.
After Texas's $140,000 homestead exemption, the Boerne bill drops to approximately $5,700. That's a $7,500 annual savings versus the California property tax alone.
Hill County Tax Rates (2025)
| County | Combined Rate | Annual Tax on $425K Home | After $140K Homestead Exemption |
|---|---|---|---|
| Kendall County (Boerne, Fair Oaks Ranch) | 1.8% – 2.4% | $7,650 – $10,200 | $5,100 – $6,800 |
| Bexar County (San Antonio) | 2.2% – 2.7% | $9,350 – $11,475 | $6,350 – $7,675 |
| Comal County (New Braunfels) | 1.9% – 2.3% | $8,075 – $9,775 | $5,475 – $6,575 |
The honest bottom line: If you buy a $500,000 home in Kendall County, expect to pay roughly $7,000 to $9,000 per year in property tax after exemptions. That's real money. But compare it to the total tax picture — California state income tax alone on a $200,000 household income is approximately $17,500, which is more than double the Texas property tax bill.
Tax Protest Tip
Every year, Texas appraisal districts send you a notice of assessed value. You can protest if you believe it's too high. A well-prepared protest typically reduces your assessed value by 5% to 15%. Many property tax consultants work on contingency — no upfront cost. This is a built-in feature of the Texas system, and you should use it every year.
3. State Income Tax — The Single Biggest Line Item
Texas levies no personal income tax. Zero. None on wages, salaries, dividends, interest, or capital gains. California's top marginal rate is 13.3% — the highest in the nation. For most relocating households, this is the single largest source of annual savings.
Actual California State Income Tax by Household Income
The following estimates reflect married-filing-jointly federal returns, after standard deduction ($11,412), for the 2025 California tax year:
| Household Income | CA State Income Tax (est.) | TX State Income Tax | Annual Savings |
|---|---|---|---|
| $100,000 | ~$5,200 | $0 | $5,200 |
| $150,000 | ~$10,300 | $0 | $10,300 |
| $200,000 | ~$17,500 | $0 | $17,500 |
| $300,000 | ~$27,000 | $0 | $27,000 |
| $500,000 | ~$47,000 | $0 | $47,000 |
| $1,000,000 | ~$105,000+ | $0 | $105,000+ |
At $500,000 income, you're saving roughly $3,900 per month in state taxes alone. Over five years, that's $235,000 — before accounting for any other cost differences. This is not a marginal benefit. It fundamentally changes the financial equation of where you live.
"Texas is one of nine states that do not levy a personal income tax. This means no state tax on wages, salaries, dividends, or interest income."
— Texas Comptroller of Public Accounts
4. Utilities — Electricity, Gas, Water (The Full Picture)
Utilities are where the "Texas is cheaper" narrative gets complicated. Electricity rates are lower per kilowatt-hour, but summer cooling demands in the Hill Country are relentless. Natural gas is genuinely cheaper. Water costs vary depending on whether you're on municipal supply or a private well.
Electricity: The Deregulated Market Explained
Most of Texas operates under a deregulated electricity market managed by ERCOT (Electric Reliability Council of Texas). This means residential consumers can choose their Retail Electricity Provider (REP) from a competitive marketplace — unlike California, where your utility is essentially assigned to you.
The key exception: San Antonio. San Antonio is served by CPS Energy, a municipally-owned utility. Residents do not choose their provider. CPS Energy rates average approximately $0.12 to $0.13 per kWh — competitive but not deregulated. Boerne and Fair Oaks Ranch are served by different providers depending on exact location; parts are in the deregulated market, parts have co-ops or municipal service.
| Utility Category | California (avg.) | Texas Hill Country (avg.) | Honest Assessment |
|---|---|---|---|
| Electricity rate per kWh | $0.28 – $0.32 | $0.12 – $0.14 | Texas rate is substantially lower |
| Summer electric bill Jun–Sep, 2,500 sq ft home | $180 – $280/mo | $220 – $350/mo | Texas can cost more — summer cooling loads are higher than California's mild coastal climate |
| Winter electric bill Nov–Feb, 2,500 sq ft home | $120 – $200/mo | $100 – $170/mo | Texas is typically lower in winter |
| Annual electric total | $2,000 – $3,000 | $1,800 – $2,800 | Roughly comparable over a full year |
| Natural gas per therm | $2.10 – $2.50 | $1.00 – $1.40 | Texas is substantially lower — major gas-producing state |
| Water / Sewer monthly, municipal | $70 – $120 | $50 – $100 | Comparable; well water can eliminate this bill entirely |
The Summer Reality
Here's what most relocation guides won't tell you: Texas summer electricity bills can exceed California's. The Hill Country regularly sees 95°F to 105°F days from June through September. A 2,500 sq ft home running air conditioning continuously can easily hit $280 to $350 per month during peak summer. If you're coming from San Francisco or coastal LA with its mild summers and no A/C, this is a real adjustment.
Over a full year, the math still favors Texas — the lower per-kWh rate offsets the higher summer usage, and winter heating bills are lower. But budget for summer sticker shock. A smart thermostat, good insulation, and a properly sized HVAC system make a significant difference.
Texas Energy Market: What You Should Know
- In deregulated areas, you can choose fixed-rate or variable-rate plans. Fixed-rate is strongly recommended for predictability.
- San Antonio (CPS Energy) is not deregulated — you get one provider, one rate.
- Texas wholesale prices can spike during extreme weather events (as seen in Winter Storm Uri, 2021). Variable-rate plans exposed consumers to catastrophic bills during that event.
- Some Hill Country properties have co-op electric service (e.g., Pedernales Electric Cooperative), which operates differently from both the deregulated market and municipal utilities.
5. Homeowner's Insurance — Texas Costs More (Here's Why)
Texas homeowner's insurance is among the highest in the nation. This is another area where honesty matters more than salesmanship.
| Factor | California | Texas (Hill Country) |
|---|---|---|
| Average annual premium | $2,900 – $3,500 | $4,000 – $5,500 |
| Primary risk drivers | Wildfire, earthquake (separate policy), mudslide | Hail, wind, severe storms, occasional flooding |
| Market availability | Increasingly difficult in fire zones; non-renewals rising | Generally available; premiums high but policies obtainable |
| Trend | Premiums rising 15–30% annually in fire-risk areas; State Farm, Allstate pulling out | Premiums rose ~27% over 3 years; driven by billion-dollar hail/storm events |
Why Texas Premiums Are Higher
Texas leads the nation in hail damage claims. The Hill Country sits in "Hail Alley," a corridor from San Antonio through Fredericksburg that sees some of the most frequent and severe hailstorms in the country. In 2023 and 2024, Texas recorded multiple billion-dollar hail events. Insurers pay out more per capita here than almost anywhere else.
Wind coverage is included in standard policies in most Hill Country areas, but if you're near the coast or in a designated windstorm area, you may need a separate windstorm policy through the Texas Windstorm Insurance Association (TWIA).
The California Counterpoint
While California premiums are nominally lower, the market is deteriorating rapidly in fire-prone areas. State Farm stopped issuing new policies in California in 2023. Allstate, AIG, and others have followed with restrictions. If you're in a WUI (Wildland-Urban Interface) zone, your California homeowner's insurance may be non-renewed, leaving you in the California FAIR Plan — which provides limited coverage at high cost.
The honest assessment: Texas premiums are higher, but you can actually get a policy. In parts of California, getting affordable coverage is becoming the bigger problem.
6. Auto Insurance — A Modest Texas Advantage
Auto insurance is one of the quieter savings categories. California consistently ranks among the most expensive states for car insurance due to high accident density, litigation costs, and uninsured motorist rates.
| Metric | California | Texas |
|---|---|---|
| Average annual premium (full coverage) | ~$3,444 | ~$3,106 |
| Key cost drivers | High population density, litigation, uninsured drivers (16%+) | Hail damage claims, uninsured drivers (~14%), urban accident rates |
| Net annual savings | ~$340/year ($1,700 over 5 years) | |
The savings are real but modest — roughly $340 per year. In Hill Country areas outside San Antonio, premiums tend to be lower than the statewide average due to lower traffic density and fewer accidents. If you're moving from LA or the Bay Area to Boerne, your auto insurance could drop by $500 to $800 annually.
7. Groceries & Everyday Expenses — Consistent Daily Savings
Grocery and everyday expense differences don't make headlines, but they compound. California grocery prices run approximately 9% to 15% above the national average. Texas grocery prices run 5% to 10% below the national average. For a family spending $1,200 per month on groceries, that gap represents roughly $1,800 to $3,000 per year.
| Category | California | Texas Hill Country | Annual Impact (family of 4) |
|---|---|---|---|
| Groceries | 9–15% above national avg | 5–10% below national avg | $1,800 – $3,000 saved |
| Dining out | 10–15% above Texas | Baseline | $1,000 – $2,000 saved |
| Gasoline | ~$4.75/gal | ~$2.95/gal | $1,500 – $2,100 saved (at 12K mi/yr, 28 MPG) |
| Vehicle registration | ~$465/yr ($50K car) | ~$78/yr | $387 saved |
| Sales tax | 7.25% – 10.75% | 6.25% – 8.25% | Varies by purchase volume |
| Childcare (full-time infant) | $1,800 – $2,200/mo | $900 – $1,200/mo | $10,800 – $14,400 saved |
Gasoline is the most visible daily difference. At a statewide average of $2.95/gal versus California's $4.75/gal, a driver covering 12,000 miles per year at 28 MPG saves roughly $1,800 annually — just at the pump. Vehicle registration is another quiet win: Texas charges roughly $78 per year regardless of vehicle value, while California's value-based registration can exceed $465 for a $50,000 car.
8. Healthcare Costs — Comparable, With Key Differences
Healthcare is the most complex comparison because costs depend heavily on your insurance situation — employer-provided, marketplace, or self-employed. The good news: neither state is dramatically cheaper than the other for insured households, and the Hill Country has strong medical infrastructure.
| Healthcare Metric | California | Texas |
|---|---|---|
| Avg. employer-sponsored premium (single) | ~$10,033/yr | ~$8,435/yr |
| Avg. employer-sponsored premium (family) | ~$28,397/yr | ~$22,392/yr |
| Uninsured rate | ~6.5% | ~18% (highest in nation) |
| Medicaid expansion | Yes (Covered California) | No — stricter eligibility |
What This Means for Relocators
If you have employer-provided insurance, your premiums will likely be lower in Texas — both for single and family coverage. The gap is significant: roughly $1,600/year for individuals and $6,000/year for families.
If you're self-employed and purchasing through the marketplace, Texas's refusal to expand Medicaid creates a "coverage gap" for lower-income adults. However, the ACA marketplace (HealthCare.gov) still provides subsidized plans, and the premiums are generally comparable to California's Covered California plans for equivalent coverage.
The concern: Texas has the highest uninsured rate in the nation (~18% vs California's ~6.5%). This is driven by Medicaid eligibility limits, not by insurance availability. If you have employer coverage or can afford marketplace plans, this statistic doesn't affect you directly — but it does affect the broader healthcare ecosystem, emergency room utilization, and uncompensated care costs.
The Hill Country has strong medical infrastructure. The South Texas Medical Center in San Antonio is one of the largest medical complexes in the country, with over 900 beds across multiple hospitals. Methodist Hospital, University Hospital, and CHRISTUS Santa Rosa are all within 30 to 40 minutes of Boerne and Fair Oaks Ranch.
9. The Complete Annual Savings Breakdown — All Categories
Here is a comprehensive annual savings estimate for a household earning $200,000, relocating from the San Francisco Bay Area to Boerne, Texas. Every line item is sourced; nothing is padded.
| Category | Estimated Annual Savings | Confidence |
|---|---|---|
| State income tax elimination ($17,500 → $0) | $17,000 – $18,000 | High — based on published FTB brackets |
| Housing cost differential (mortgage + equity building) | $12,000 – $24,000 | High — based on median price gaps |
| Property tax increase (TX higher rate, lower base) | −$1,000 to +$2,000 | Medium — depends on exact properties compared |
| Homeowner's insurance increase | −$1,000 to −$2,000 | High — Texas premiums are reliably higher |
| Electricity + natural gas | $500 – $1,500 | Medium — offset by summer cooling costs |
| Gasoline + transportation | $1,500 – $2,500 | High — based on EIA price data |
| Groceries + dining | $2,000 – $4,000 | High — BLS regional price data |
| Vehicle registration + fees | $350 – $400 | High — published DMV data |
| Auto insurance | $300 – $800 | Medium — varies by driver profile |
| Healthcare premiums (employer) | $2,000 – $6,000 | Medium — depends on employer plan |
| Estimated Total Annual Savings | $34,000 – $57,000 |
The Five-Year Picture
At the midpoint of these estimates (~$45,000/year), a relocating household retains approximately $225,000 in additional wealth over five years — before accounting for home equity building, investment returns on saved income, or career growth.
This is not theoretical. These are published rates, median prices, and tax brackets applied to a real relocation scenario. Your actual numbers will differ based on your specific California origin, income level, family size, and Texas community choice. But the direction and magnitude are consistent across nearly every scenario above $125,000 household income.
10. What the Numbers Don't Capture — The Honest Addendum
No cost comparison can capture everything. Here are the real, tangible differences that matter but don't fit neatly into a spreadsheet:
Summer Heat Is Real
Hill Country summers are long, hot, and humid by coastal California standards. June through September averages 90°F to 100°F, with occasional stretches above 105°F. If you're coming from San Francisco or coastal LA, this is a significant lifestyle adjustment. Your cooling costs reflect this — but the daily experience of it matters too.
Property Tax Starts Fresh on Purchase
When you sell your California home with its accumulated Prop 13 benefit and buy in Texas, you start fresh. The CAD will appraise your property at its market value as of January 1 — your recent purchase price may inform that assessment, but in Texas's nondisclosure state, the CAD determines value independently, and the appraised amount can differ from what you paid. The 10% annual cap then limits further increases in appraised value once homestead qualification takes effect. You don't carry over any California tax advantage. Factor this into your total-tax calculation, not just the rate comparison.
No State Income Tax Means Less Safety Net
Texas's zero income tax comes with tradeoffs. The state has no state-funded paid family leave, no state disability insurance, and stricter Medicaid eligibility. If your financial situation changes — job loss, disability, family emergency — the California safety net is meaningfully more generous. For stable, employed households this is less relevant. For transitioning or self-employed households, it matters.
Water Is Not Free
Hill Country properties on well water avoid municipal water bills but bear the cost of pump maintenance ($200–$500/year), water testing ($100–$300/year), and potential treatment systems ($1,500–$5,000 upfront). The Edwards Aquifer Authority also imposes pumping limits in certain zones. Water is abundant in the Hill Country compared to coastal California, but it's not without cost or regulation.
HOA Fees
Many Hill Country communities, particularly in Fair Oaks Ranch and newer Boerne developments, carry HOA fees of $500 to $3,000+ per year. These are not typically present in older California neighborhoods. Factor them into your housing cost comparison.
Want your actual numbers?
Bill can model your specific California income, home sale price, family size, and target Texas community to produce a precise first-year and five-year savings projection — using real tax rates, current market data, and your actual circumstances.
Continue Researching
Prop 13 vs Texas Property Tax
The full breakdown of California's assessment caps vs Texas rates, with millage data for Kendall, Bexar, and Comal Counties.
Cost Comparison Table
A category-by-category table covering 11 everyday cost comparisons between California and Texas.
City Comparison Guide
Boerne vs Fair Oaks Ranch vs San Antonio — pros, tradeoffs, and which community fits your profile.