Tax Benefits of Investing in Austin, Texas Real Estate

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Investing in real estate in Austin, Texas comes with several tax benefits. Many people look at Austin, Texas as one of the major music capitals of the world, however, it is much more than just that.

Austin is growing exponentially, both residentially and commercially. Many investors are purchasing real estate in this location because of the rising population, affordable housing market, and tax benefits of course, alongside all the job opportunities. Austin is a hot market right now and as an investor, there is no time like the present to take advantage.

As a local Austin company, we’ve seen this beautiful city grow into what it is today. We’ll be covering 6 important aspects of investing in Austin real estate.

Rising Population

Investing in an area that has a rising population is always a good thing. You know the market will be relatively stable and you can depend on a stable rental income. Austin is well known for providing a stable real estate market and being dynamic with its real estate options.

There must be a reason why tech professionals, musicians, executives, and other professionals come to Austin. According to Forbes in 2017 and 2018 over 50,000 people or approximately 145 people every day moved to Austin, Texas. This gave it the ranking of being the highest-growth city in the USA for the year 2017-2018. Austin has been steadily growing at a 20% population growth over the past eight years.

Low Unemployment Rate

The unemployment rate is extremely low in Austin, which is another reason why people are moving to this part of the country. These are all factors that investors want to hear and good reasons for them to invest in real estate. With the social and economic situation in Austin, investors see this area as a great real estate opening.


The industry growth is a huge benefit to investors planning on purchasing real estate in Austin. There is no doubt that the economy here is booming when you see large companies such as Google, Amazon, Facebook, and Whole Foods amongst the other top companies that are planning on setting up operations here.

Major Tax Benefits

When it comes to major tax benefits, the low price of real estate and the high occupancy rate are among the main reasons to invest in real estate in Austin and save money. Texas is one of the seven states that don’t have an income tax, which is another bonus.

Back in September 2015, Texas repealed its inheritance tax, which means there is no estate tax in Texas on properties valued under $11.4 million. There are many property tax exemptions in Texas; you just have to familiarize yourself with them and understand how the process works.

Millennial Workforce

Another great reason to invest in Austin, Texas is its millennial workforce. Austin is a city with one of the youngest working populations. Over 30% of its working-class is between the ages of 15 and 35 years old.


This is a rather young demographic, which means there are many opportunities for new people and the younger generation to grow. The main trick with real estate investing is being able to prosper and understanding what you can afford and how you can capitalize on it.

Anyone can sign some papers and purchase a property, but being able to maintain that property and find quality renters in order to have cash flow coming in is the tricky part. A huge tax benefit with purchasing real estate is more so in the form of deductions. A real estate investor can deduct expenses such as property taxes, mortgage interest costs, any repairs and depreciation costs, as well as operating expenses. When you take all that into consideration, that’s a significantly large saving.

Long-Term Capital Gains

A tip for an investor when it comes to selling and having to pay capital gains is that you will want to go with long-term capital gains as you will be taxed less. Doing it this way will allow you to bank on your deductions to lower your taxable sum.

When you rent out a property, the owner will have a great deal of wear and tear on their rental property. Of course, this is the depreciation of the property, which you can write off. Even though your property might be producing a high volume of cash flow due to rental income, you can still write off depreciation costs due to wear and tear.

The Bottom Line

There are a countless number of benefits to owning and renting out properties in Austin, Texas it is no wonder that the population is growing exponentially.


Hiring a property management company is the easiest way to take advantage of the market! Don’t miss out on a great opportunity due to not having the time to manage the properties.

Contact us today at (512) 339 – 8112 for more information.