The tech exodus from California to Texas has been one of the biggest economic narratives of the decade. Startups, tech giants, and thousands of software engineers packed their bags and migrated from San Francisco to Austin, seeking cheaper housing and relief from state taxes. But now that the dust has settled, does the math still add up?
The State Income Tax Equation
The primary financial hook for moving to Texas is the tax rate: Texas has 0% state income tax. California, by contrast, has the highest state income tax brackets in the nation, topping out at 13.3% for high earners. For a developer earning a $180,000 base salary, moving to Austin results in an immediate net savings of roughly $12,000 to $15,000 per year in state income taxes alone.
However, Texas makes up for this loss of state revenue through exceptionally high local property taxes, often exceeding 2% to 2.5% of a home's assessed value per year. If you plan to buy a home in Austin, your property tax bill can quickly eat into your income tax savings.
Compare SF and Austin Live
Calculate the true standard of living conversion between the Bay Area and the Silicon Hills. Enter a salary to see the real-time PPP adjustment:
Housing: Post-Boom Realities
During the peak of the pandemic boom, Austin housing prices skyrocketed. However, Austin has recently experienced a healthy supply-driven housing correction. Renting a modern 1-bedroom apartment in downtown Austin now averages around $2,000 to $2,300, whereas a comparable unit in San Francisco still demands $2,900 to $3,400. In terms of square footage and home-buying potential, Austin remains significantly more accessible.