How much does it cost to live in Texas?

Texas has taken the throne from Florida and California as the most attractive state for Latin American foreign investors who want to invest and live in the United States. There are several factors that contribute to this phenomenon of growing interest in living in Texas:

• The world’s largest tech companies are moving to Texas, and with it jobs.

• Ownership costs are considerably cheaper than other states like California.

• Living costs are low, and at the same time quality of life is high.

• It is a state that the same laws support entrepreneurship and companies.

• It is one of the most fiscally attractive states, since there is no income tax.

• You can find sports, music, beaches, and various activities.

Franchising is usually the preferred method for all those foreigners who want to invest and immigrate to Texas. After acquiring a franchise, you will be able to qualify for the E-2 visa. That is why we advise on this franchise acquisition process in Texas. But, before you think about investing and immigrating to Texas, it is important to know, how much does it cost to live in Texas? Read on to find out.

How much does it cost to live in Texas

The short answer is: IT DEPENDS. How much does it cost to live in Texas is a very complex question to answer, it’s as if I were asking you: How much does it cost to live in Mexico? Or how much does it cost to live in Argentina, Colombia, or any country of which you are a citizen?

The answer, no matter where you’re from, will always be the same: it depends.

The factors that can influence your cost of living in Texas depend on:

• How do you like to live?
• Do you prefer to buy luxurious things?
• Looking to live in a big city?
• Do you want to live in the best areas of the city?
• How many members are there in your family?
• Do you have children, are they about to enter university?

Having clarified the fact that there are many indicators that can influence the cost of living in Texas, we could say that in order to get a decent living in Texas with 2 children, you should get an annual net household income of $70,000 USD – $100,000 USD. Therefore, you should have a monthly net income in your household of $5,833 USD – $8,333 USD to immigrate to Texas.

Now, the word “decent” should be defined a little more, because we understand that each person has a different criterion of what a “decent quality of life” means. We consider that a decent lifestyle in Texas is to be able to pay rent, or a mortgage on a house or apartment with 3 bedrooms, in a good area, to be able to pay for a pantry, to be able to go out on weekends without great luxuries, to be able to make one or two trips per year with the family or partner, to pay the loan of two new or pre-owned cars and to have an extra amount for some other variable expenses.

Likewise, here it is assumed that there will be no daycare costs, in case the children are minors, so in this example daycare expenses are eliminated. This would imply that a parent would probably have to have a part-time job or dedicate themselves to the house. In case both parents work, they should consider between $700 – $1,000 of expenses per child per month. Yes, I know, daycare is very expensive.

Let’s see how much it costs to live in Texas

I would like to present you with an exercise. Let’s structure two different ranges of quality of life, one lower and the other higher. On the downside, we’re going to assume you’re moving to an inexpensive city in Texas, such as San Antonio, Houston, or a border city like McAllen. We also assume that you will not have many luxuries and that your costs are basic. In the high range we will assume that you will be living in some more expensive city in Texas, such as Dallas or Austin.

Let’s break down the cost of living using this hypothetical example:

This is a general average so you can get a little clearer idea about the overall expenses of a family in Texas, but as we mentioned, many of these ranges will vary depending on the factors we told you above, such as the city you choose to settle in.

After discussing the importance of considering lifestyle and personal preferences in the cost of living in Texas, it is crucial to provide specific examples that illustrate how these factors can influence monthly expenses. Take, for example, the cities of Houston and Dallas, where the cost of living varies significantly in things like housing, food, and transportation.

In Houston, living alone could imply an average rental expense of $1,578.80 for a one-bedroom apartment in the center, while in Dallas this cost would amount to $1,765.57. Basic services, an essential component of the monthly budget, would be around $225 in Houston and $238.17 in Dallas. These concrete examples highlight how the choice of city can directly affect monthly expenses.

When considering living as a couple or with a family, housing, food, and transportation costs are modified, presenting a new set of financial considerations. For example, the rent for a three-bedroom apartment in downtown Houston is approximately $3,258.04, while in Dallas this cost increases to $3,803.18. Additionally, for families with children, it is important to consider additional expenses such as childcare and education, where Houston and Dallas show significant variations in educational costs.

These examples help us to understand that, if you are prospecting to immigrate to the United States through an investor visa, you should at least have the first 6-12 months of living expenses contemplated, in order to provide a certain time margin to your company to start and show green numbers.

If we average the range between the two totals (the low one of $5,833 and the high one of $8,333), the estimated amount of monthly expenses to immigrate to Texas is $7,033. Therefore, you need to contemplate between $70,000 – $100,000 of expenses to support you and your family for a year. It is for this very reason that we often recommend our clients to have a budget of $50,000 – $70,000 for their first year living costs or an alternative cash flow.

Now, it also happens that many have certain income in their country of origin, or even have investments that are generating some type of monthly income, and that can alleviate these amounts.

We find it interesting to highlight two issues, the first is that it is not necessary to have all this money in liquid form from the beginning, because we contemplate six months to a whole year. The second issue, remember that we are considering two children, so the total cost of living can be modified depending on the members of your own family.

There’s light at the end of the tunnel, I promise you…

Coming from a Latin American country, the costs of immigrating to Texas may sound very high, but remember that average expenses are also equal to income. Many low-cost franchises ($120K – $150K), can achieve this revenue in less than a year. We have customers who reached these figures for 7-8 months in operation.

Remember, NO franchise or business can guarantee you by law certain income and/or specific profits, mainly because the franchise can provide you with the training and all the necessary tools to be successful, but it is your business and it depends on how you operate it and have structured it. If the largest and strongest companies and monopolies in the world cannot guarantee it, much less a franchise.

How Much Can I Earn With a Franchise in Texas

Asking how much you can make with a franchise in Texas is as general as asking: How much can I make in a job? Well, it depends, are you a doctor? Are you a worker? Are you an astronaut?

It’s the same in a franchise, there are people who lose money and there are also people who earn millions a year. The number one factor of how much you can earn in a franchise in Texas I would say depends on how much time and money you want to invest in it, especially at the beginning. It will also depend on the scheme you have in mind and the budget you have available.

This year I participated in the annual convention of the franchise I own. Almost all franchises have conventions annually, and it is in these spaces where all the franchisees, the franchise intern team, all the suppliers meet. Also, they usually invite speakers and people related to the industry, it is a very nice event where you get to know everyone and above all you learn A LOT.

For example, I talked with 3 owners, the 3 had very different schemes and goals:

The first franchisee I spoke with had been operating for a year and a half, had six employees, and was producing more than $1.2 million in sales.

The second owner I spoke with had been in business for more than seven years, has two employees and produces less than $600,000 in sales.

The third franchisee had been in business for 4 years and had no permanent employees, he was generating less than $475,000 in sales.

Now, guess who earned the most of those three entrepreneurs. Well, believe it or not, the 3rd franchisee. He had no employees, had few fixed costs, did not have an office and worked from home. But, guess who he was who worked the longest hours. The 3rd franchisee too. He worked more than 75 hours a week, due to the fact that since he has no employees, the business depends 100% on him. If he goes on vacation, his business also goes on vacation with him. Your business is not going to grow much more if you stick with that same scheme, since one person only has X amount of time to attend to your business.

Now, the first franchisee I talk to could earn more, but he prefers to pay less to himself and invest to grow his operation, so that his business can generate, even if he is not present.

The three franchisees paid themselves more than $100,000 a year and the third earned a little less than $175,000 annually. The only difference was that they had different goals, ideologies, and ways of operating a business. Same franchise, different results.

Finally, to add to this example, I met another franchisee of the same franchise, this person owns four territories, has been operating for less than three years and has twenty-one employees. In addition, it intended to acquire three other territories in the next two years. He told me that he paid a low salary, since he is in expansion mode and has other franchises already operating, so he does not depend on that salary to live.

As you can see, how much profit you can make with a franchise in Texas is a very variable issue, as it depends on multiple factors, so it is important to be clear about the goals, vision, budget, and lifestyle you want to have. That’s why I ALWAYS tell my clients that we have to get them into the process so that they understand how much they can actually earn with the budget they have and also see the lifestyle that we can create with that budget, since we work with over 750 franchises nationwide and each franchise is different. That’s why this answer can be complex.

What our process gives you is more clarity on what you can do, how much you can earn, and what you have to do to earn X amount. There are two parts of the process where you as a customer understand this:

One is the initial part where you will be able to see article 19 of the FDD of a franchise. Article 19 of the FDD is basically an official document of the franchisor with averages of income at the national level to get a general idea.

The second most crucial part of our process is called “validation”, this is where you talk to other franchisees who are already operating and you talk to different owners with different schemes, different goals, and different budgets.

By doing this you will be able to understand what you have to do to have the income and lifestyle you want.

I can share with you that in most GOOD franchises you can easily generate income of $70,000 – $100,000 in about 1 year or less, as long as the owner or owners are behind the business and follow the franchise system. It is important for me to mention that this is not a guarantee, but a summary of the hundreds of franchisees with whom I have had the opportunity to talk and meet in the different franchises.

Renting or buying a home to live in Texas?

Before elaborating on this point, it is imperative to mention that much of this content is aimed at that type of foreign investor who commonly does not have access to a mortgage, does not have a Social Security Number, and already has an E-2 visa or is about to process their E-2 visa.

The importance of having Realtors

In the United States there is a profession called “Realtor”. Basically, a realtor is a real estate agent who is licensed in Texas to help people find real estate. Competent realtors will specialize in certain niches, whether residential, commercial, or investments.

The realtor will help you navigate both renting a property or buying it. Usually, the services of a realtor are free, but there are circumstances where you can be charged for their tasks. Typically, in the industry, the seller of the property pays the commissions of both the realtor who works with the buyer, as well as the realtor who works with the seller. This is very normal in the United States and especially in Texas. Sometimes it may sound a little weird for the seller to pay your real estate agent, but remember that it’s a regulated profession at the local, state, and even national levels. This doesn’t mean that all realtors are competent or looking out for your best interest.

If you need a real estate agent in Texas, we can recommend you with competent people, who speak Spanish, and have experience with foreign investors, since many of them do not know how to structure and face this process when they have foreign clients. Contact us.

Why We Recommend Renting in Texas

Usually we recommend my clients to start this life project by renting a house or an apartment. Depending on your budget and your tastes, you can rent an apartment or a house. There are reasons why we recommend that you start this process by renting a property and not buying:

• You will reduce expenses at the beginning of the project.

• You won’t decapitalize so quickly.

• In case the area you moved to is not to your liking, you will be able to move more easily.

• It may happen that your children’s school district, once you really know it, does not convince you, and therefore you will have the possibility of moving in a more agile and practical way than if you bought your house.

• You will have more flexibility in short terms. After all, when you rent you don’t use much liquid capital.

Renting an apartment in Texas

In Texas, it’s very common to rent an apartment in a complex. Usually, these complexes have a swimming pool, gym, office, and other amenities that can be used by tenants. There are quite inexpensive resorts, and also some very luxurious ones.

The cost will vary depending on the area in which it is located within the city, the size, and the luxuries that the complex has. In Texas, you can spend between $1,500 – $2,200 per month for a 3-bedroom, 2-bathroom apartment, which is the standard size of a large apartment (these are current averages from October 2021). On average, for a 3-bedroom, 2-bathroom apartment, you will have a space of between 110–150 square meters. Generally, this type of complex will make leases for one year, in some complexes you can sign for shorter terms (3 or 6 months).

Apartments are usually the first accessible, simple, fast and easy option to make regardless of your immigration status. There are some complexes that are stricter than others, but it’s usually not very difficult to lease an apartment.

Renting a Home in Texas

Renting a home can also be an option for investing and living in Texas. Normally, this option is a little more expensive, not only because of the rent itself, but because you have to consider the maintenance, care, furnishing of more spaces, etc. At the same time, there is not a very large inventory to rent a house in the long term, and there are two fundamental reasons:

1. The demand for the purchase of real estate that currently exists (October 2021) in Texas is very high.
2. People end up renting through different applications, such as AIRBNB or other similar platforms, because it is much cheaper.

Now, if you find a home you like in Texas, in an area that you really find appealing, you’re going to be looking forward to paying between $2,000 – $4,000 a month, without considering the maintenance of the house. Another common obstacle to renting a house is thatthe deposits are usually larger, compared to an apartment, sometimes, the owners of these properties also generate some fear of renting to a foreign investor, since they do not have a Social Security Number they are more suspicious.

Living in Texas: Which City Is Best for You?

Before you decide which city in Texas you want to immigrate to, it’s important to ask yourself:

• What lifestyle do I want?
• If you have a family, what lifestyle do I want for my family?
• Do I want to live in an area or city with many Hispanics?
• Do I want to live in a quiet city?
• What activities do I like to do?
• Do I want to live in a rural or urban area?
• How much does it cost to live in this area?

These are just a few examples of the questions you should ask yourself before immigrating to Texas.

Below we will analyze the cities of Houston and Dallas so that you can have a more assertive approach to each of them, and you can make an informed decision.

Houston, Texas

Population in Houston

It is one of the five most populous cities in the entire U.S. The U.S. has a total of 2.32 million inhabitants according to the 2020 census, and 43% are Spanish-speaking Latin Americans, so the culture shock will be drastically less.

Economy in Houston

Houston brings to life a growing entrepreneurial economy that has diversified into high-tech , medical research, health care and professional services industries. The most thriving industries are oil, medicine, high technology, those related to the government, companies that do import and export tasks, those linked to fishing, agriculture. In addition, companies in finance, education, and the film and media industry stand out. Within Houston are 23 of the Fortune 500 companies.

In addition, many foreign corporations have established a presence in Houston to gain access to North American markets thanks to the city’s excellent distribution routes.

Houston’s regional gross domestic product is $85 billion, larger than Austria, Argentina or Colombia’s GDP.

Education in Houston

Houston has more than 60 colleges, universities, and other educational institutions with a total of approximately 360,000 students. There are five public universities involved in research and development: The University of Houston (UH), Rice University, the University of Houston-Clear Lake (UHCL), the University of Houston-Downtown (UHD), and Texas Southern University (TSU). Other public colleges include Lone Star College System and San Jacinto College.

In the city, there is an average of 12,500 new graduates annually from the University of Houston system. In addition, Houston Community College is the fourth-largest community college system in the country. So if you want to study and immigrate to Texas, this is the city to do it.

Popular Houston Areas to Immigrate

Downtown/Uptown

If you like urban life, this is the area for you. Surrounded by the heart of Houston and all the skyscrapers in the city. This is usually a youthful area with many activities, events, and noise. There is always something to do here in the evenings. If you plan to live in this area, be prepared to pay high rents in the complexes. During the day you can find a lot of shopping in the mall “The Galleria”, modern restaurants, cafes, and 5-star hotels. This is where there are usually a lot of young professionals or young families. If you are looking to have a large space at an affordable price, it is better to look in another area, as it is usually highly sought-after.

The Woodlands

I would say it’s the most popular area for Hispanics with families in the Houston area. It is an area with a lot of affluence and a forest look very distinctive from the rest of the city. The Woodlands is located in the north area of Houston with many diverse activities. It is an area with large spaces, many parks, and very clean.

Due to the same level of affluence, it is an area with very nice houses but at the same time expensive. The average home in “The Woodlands” according to Zillow is $436,179 (October 2021). In just one year, house prices have risen by 17.6% (August 2020 – August 2021).

The same schools rank quite highly.

Other popular areas of Houston to immigrate:

• Spring, Texas
• Sugarland, Texas
• Humble, Texas
• Pearland, Texas

Dallas, Texas

Population in Dallas

It is the #9 most populous city in the entire U.S. The U.S. has a total of 1.3 million inhabitants according to the 2020 census, and 41.8% are from Latin American countries. This makes it a city for many of our customers.

Economy in Dallas

Dallas’ economy is primarily driven by its technology, financial, and military defense industries. The largest employers in the city are American Airlines, Bank of America, Texas Health Resources, Lockheed Martin, Walmart. However, there is a high demand for teachers, doctors, nurses, engineers, and accountants. Within the city of Dallas, there are 19 Fortune 500 companies that have their headquarters, including Advance PCS, Dean Foods, Exxonmobil, Southwest Airlines, Neiman Marcus, etc.

Education in Dallas

The city of Dallas offers many opportunities at all academic levels. Within Dallas and its suburbs there are more than 35 universities to select from, among which the most prestigious are Southern Methodist University (SMU), University of Texas at Dallas (UTD), Texas Christian University (TCU), and University of Dallas (UD).

Popular Areas of Dallas to Immigrate

Frisco and Plano are some of the most desirable areas in the real estate market in Dallas today. As it is a fairly new area with a quiet pace of life but with things to do. They are also one of the most affluent areas of the city. Since the two are close to each other, that’s why we decided to put them together. The average home in Frisco is $541,512, this price has risen more than 26% since last year. The average home in Plano is $437,915 at 24.1%. Which is high prices, but that happens as a result of the demand they have been having in recent months.

• Frisco, Texas and Plano, Texas
• Other Popular Areas of Houston to Immigrate
• Grapevine, Texas
• Denton, Texas
• Arlington, Texas
• Garland, Texas

In summary, living in Texas as a foreign investor is an exciting adventure, but it requires careful financial planning and a clear understanding of your goals and preferences.

With a strategic approach and the right support network, your transition can be as successful as it is inspiring.

At Interlink FBC we have a network of strategic contacts to help you land in the United States. Contact us today.