Moving from Chicago to Austin: A Practical Comparison

Every year, thousands of Illinois residents make the move south to Texas, and Austin is consistently one of their top destinations. If you have been thinking about moving to Austin from Chicago, you are not alone, and you likely have a lot of specific questions. How much do you actually save on taxes? What does your housing budget get you? What does summer feel like compared to a Chicago winter?

This guide is built around those questions. Rather than a general overview of why Austin is growing, this is a direct, category-by-category comparison of the two cities, with real numbers and honest trade-offs. Whether you are at the early research stage or already have a moving date in mind, the information here is designed to help you make a clear-eyed decision.

Cost of Living: What Changes When You Leave Illinois

Cost of living comparisons between major cities can be misleading if you only look at one category. Austin is not uniformly cheaper than Chicago across the board, but the overall index does favor Texas. According to the Missouri Economic Research and Information Center (MERIC), Illinois carries a composite cost of living index around 98.4, while Texas comes in around 93.2. That difference adds up over time, particularly for households with higher incomes.

Everyday Expenses in Austin vs. Chicago

Healthcare costs in Austin tend to run slightly lower than in Chicago, and childcare costs are broadly comparable between the two cities. Dining out in Austin is generally less expensive than in Chicago’s core neighborhoods, though prices in popular areas like South Congress or East Austin have risen in recent years. Goods and services overall are priced similarly, with Austin being modestly more affordable.

Where Chicago clearly wins on cost is public transit. If you live in Chicago without a car and rely on the L or bus system, your transportation spend can be quite low. Austin has a limited transit network, and most residents drive. Budgeting for a vehicle, insurance, fuel, and parking is a real expense to factor in when you run your relocation numbers.

Grocery, Utilities, and Transportation Costs

Grocery prices in Austin are roughly in line with national averages, similar to Chicago. Utilities are where many Chicago transplants are surprised. Austin summers are hot, and air conditioning runs for months. Expect higher electricity bills from May through September than you are used to paying in Illinois. On the other hand, you will not pay to heat your home through a Chicago winter, which balances some of that seasonal difference.

Internet and phone costs are comparable between the two cities. Gas prices in Texas typically run lower than the national average, which helps offset the car-dependency of Austin’s layout.

The Tax Picture: Illinois vs. Texas

For most Chicago households, the tax comparison is the single most compelling reason to consider moving from Chicago to Austin. The difference is significant and immediate.

Income Tax Savings for Chicago Residents

Illinois imposes a flat 4.95% state income tax on all earned income. Texas has no state income tax. For a household earning $150,000 per year, that is roughly $7,425 back in your pocket annually, just from the state tax change. The Tax Foundation consistently ranks Texas among the most tax-friendly states in the country, largely because of this advantage.

There is no estate tax in Texas either, which matters to buyers who are thinking about long-term wealth planning. Illinois, by contrast, has a state estate tax with a threshold of $4 million and rates up to 16%. For higher-net-worth households, this distinction can be meaningful. If you want to understand how the income change fits into your broader financial picture, the work in Austin resources on this site cover compensation trends across Austin’s key industries.

Property Taxes and the Texas Homestead Exemption

The one area where Texas taxes are genuinely high is property tax. Texas effective property tax rates typically run between 1.6% and 2.2% depending on the county and school district, which is above the national average. Chicago’s effective rate has also risen in recent years, so the gap is narrower than it might appear. That said, if you are buying a home in the $400,000 to $600,000 range in Austin, your annual property tax bill will likely be in the $7,000 to $10,000 range before any exemptions.

Texas does offer a homestead exemption that reduces your property’s taxable value once you establish it as your primary residence. This lowers your annual tax bill and also caps year-over-year increases in your assessed value at 10%, which provides meaningful stability for long-term owners. Filing for the exemption is a straightforward process after closing.

Housing in Austin: What Chicago Buyers Can Expect

The Austin housing market has cooled from its 2021 and 2022 peaks, which is good news for buyers coming from Chicago. Prices are more negotiable, inventory has increased, and buyers have more time to make decisions than they did a few years ago.

Home Prices and What Your Budget Gets You

The Austin metro median home price in 2025 is in the $450,000 to $480,000 range, according to data from the Austin Board of Realtors. The Chicago metro median runs closer to $330,000 to $360,000. On paper, Austin looks more expensive. But when you account for no state income tax, lower overall cost of living, and in many cases more square footage for your dollar, the picture shifts considerably for buyers moving from higher-income positions.

A budget of $500,000 in Austin will typically get you a 3-bedroom home in a suburb like Round Rock, Pflugerville, or Cedar Park, or a smaller townhome in closer-in neighborhoods. Many Chicago buyers find that they can purchase more physical space in Austin than they could in comparable Chicago neighborhoods at a similar price point. Working with an Austin-focused buyer’s agent, such as those at Spyglass Realty, can help you understand what each price point realistically delivers across different parts of the metro.

Neighborhoods in Austin Worth Knowing

Austin’s geography rewards some research before you arrive. The city is divided into distinct quadrants, each with its own personality. Neighborhoods in Austin range from the dense, walkable energy of East Austin to the established, tree-canopied streets of West Austin and the family-oriented suburbs to the north and south.

• East Austin. Urban, walkable, dense with restaurants, bars, and creative businesses. Strong rental demand. A natural fit for Chicagoans who want a city feel.
• South Austin. Laid-back, eclectic, and well-loved. South Congress Avenue is a hub for dining and shopping. More accessible price points than some central areas.
• North Austin / Round Rock. Strong school districts, newer construction, family-oriented communities. Commute-friendly for tech campuses in the north corridor.
• West Austin / Westlake Hills. Top-rated schools, Hill Country proximity, established luxury homes. Higher price points with a quieter residential character.
• Cedar Park and Leander. Fast-growing suburbs with newer inventory, community amenities, and more affordable entry points than central Austin.

Renting vs. Buying After Relocating

Some Chicago buyers choose to rent for 6 to 12 months after arriving in Austin before purchasing. This gives you time to learn the city, understand the commute patterns, and identify which neighborhoods actually fit your lifestyle. Austin’s rental market is reasonably active, and this approach is a low-risk way to get oriented without locking in a location you do not yet know well. For those ready to buy immediately, the buying a home in Austin guide walks through what the purchase process looks like in Texas specifically.

Jobs and the Austin Economy

Austin’s economy has diversified significantly over the past decade. What was once a state government and university town is now a substantial technology and business hub, with corporate campuses from some of the largest employers in the country.

Austin’s Major Employers and Growth Sectors

Major employers in the Austin metro include Dell Technologies (headquartered in Round Rock), Apple, Tesla, Oracle, Amazon, Samsung, and the University of Texas at Austin. The healthcare sector, anchored by Ascension Seton and St. David’s Health, is a major employer as well. Financial services firms have also expanded in Austin, making it increasingly relevant for professionals in banking, fintech, and insurance.

According to the Bureau of Labor Statistics, the Austin metro unemployment rate has remained in the low-to-mid 3% range, indicating a tight labor market with consistent demand for skilled workers across sectors.

Is Austin a Good Market for Chicago Professionals?

For professionals in technology, engineering, healthcare, finance, and business operations, Austin offers a strong and growing employment base. Salaries in Austin are generally lower than in Chicago’s financial and professional services sector, but the absence of state income tax and lower overall costs mean that take-home pay often compares favorably once you run the actual numbers.

Remote and hybrid work has also expanded the pool of Austin residents who retain their current employer while relocating. If you are moving to Austin with a remote position, the tax benefit is immediate without any job change required.

Climate: Trading Chicago Winters for Texas Summers

Climate is often the most personal part of the Chicago to Austin comparison. Some people are thrilled to leave the cold behind. Others find the Austin summer harder than expected. Here is what the data and the experience actually look like.

What to Expect Season by Season in Austin

According to NOAA climate data, Austin averages 228 sunny days per year compared to 189 in Chicago. Chicago averages around 36 inches of snowfall annually; Austin averages less than one inch. The trade-off is summer: Austin experiences stretches of 95 to 105 degree days from late June through early September, and humidity adds to the heat index during parts of the summer.

Austin’s fall, winter, and spring seasons are genuinely pleasant. Winters are mild, with temperatures generally staying between 40 and 65 degrees Fahrenheit. Hard freezes do occur, typically a few days per year, and the 2021 winter storm was an outlier event that has since prompted significant grid improvements. Spring in Austin is widely considered some of the best weather in the country, with cool mornings, warm afternoons, and wildflowers in bloom across the Hill Country.

How Austinites Manage the Heat

Most Austin residents shift their outdoor routines to early mornings during peak summer months. The city has an extensive network of trails, and Barton Springs Pool, a natural spring-fed swimming pool, is a popular refuge from the heat. Lake Travis and Lake Austin provide water access for swimming, kayaking, and boating throughout the summer. Air conditioning in Austin homes is reliable and central, so indoor life during the hottest weeks is comfortable.

Lifestyle, Culture, and What You Gain (and Give Up)

Chicago is one of the great American cities, and the transition from its cultural depth and density to Austin requires honest acknowledgment of what you are leaving behind. That said, Austin has built a genuine lifestyle identity that many transplants find rewarding in different ways.

Food, Music, and Outdoor Life in Austin

Austin’s restaurant scene has matured significantly, with James Beard-recognized chefs and a deep bench of local independent dining across every cuisine. The live music culture is genuine and daily, not just a festival feature. Outdoor recreation is a core part of Austin life: Barton Creek Greenbelt, McKinney Falls State Park, the Barton Creek trail system, and easy access to the Texas Hill Country provide a quality of outdoor access that Chicago cannot match year-round.

What Chicago Transplants Often Miss

Many Chicago transplants mention missing the walkability of Chicago’s core neighborhoods, the quality of the public transit system, and the sheer density of cultural institutions: the Art Institute, Symphony Center, the theater district, and world-class museums. Austin is building in this direction, but it is a smaller city and the urban infrastructure is less developed. If you are relocating from Lincoln Park, Wicker Park, or the Loop, expect Austin’s pace and layout to feel notably different. Some people love that trade immediately; others take a full year to adjust.

For families, Austin’s suburban communities often provide excellent schools, lower crime rates, and a strong sense of neighborhood community that many transplants find appealing. The Austin relocation resources available here can help you match your family’s priorities to the right part of the metro.

 

Frequently Asked Questions

Is the cost of living in Austin lower than Chicago?

On a composite basis, yes. Texas scores roughly 5 points lower than Illinois on the MERIC cost of living index, meaning overall expenses are modestly lower. The biggest driver is the absence of state income tax in Texas, which produces immediate and recurring savings for working households. Housing prices are higher in Austin than in Chicago on a median basis, but a combination of no income tax, generally lower services costs, and greater square footage per dollar often makes Austin the financially favorable choice for higher-income households.

Do you pay income tax in Texas if you move from Illinois?

Texas has no state income tax. Once you establish Texas residency, you stop paying Illinois state income tax on income earned in Texas. You will still owe federal income tax, and if you have income sources in Illinois (such as rental property), those may remain subject to Illinois tax. Consult a tax professional to confirm your specific situation, but for most households earning wages solely in Texas, the state income tax savings are complete and immediate.

What are the best neighborhoods in Austin for people moving from Chicago?

It depends on what you are optimizing for. Chicagoans who want urban energy and walkability tend to gravitate toward East Austin or South Congress. Those with families often find North Austin suburbs like Round Rock or Cedar Park to be a natural fit, with strong schools and newer housing stock. Buyers looking for a quieter, more established residential feel often land in West Austin or Westlake Hills. Spending a few weekends in different parts of the city before committing to a neighborhood is time well spent.

Is Austin a good place to buy a home right now?

The Austin market in 2025 is more balanced than it has been in several years. Inventory has increased, price reductions are more common, and buyers have more negotiating room than at the height of the pandemic-era market. For households relocating from Chicago with strong income profiles, Austin offers a stable purchase environment with long-term fundamentals that include population growth, job diversity, and no state income tax on appreciation gains upon sale.

Making the Move: What Comes Next

Moving from Chicago to Austin is one of the more financially logical relocations available to Illinois households right now. The tax savings are real, the job market is active, and the housing market has become more accessible than it was during its peak years. The trade-offs, primarily a car-dependent layout and intense summer heat, are real too and worth factoring into your planning honestly.

The most important step is grounding your decision in specifics: your income level, your housing budget, your lifestyle priorities, and whether Austin’s geography and pace match what you are looking for long-term. The comparison is favorable for many households, but the details of your situation matter.

If you are ready to take the next step, the team at Move to Austin works with buyers at every stage of the relocation process, from initial research to finding the right neighborhood to closing on a home.

Disclaimer: This article is for general educational purposes only and is not legal, tax, or financial advice. Every situation is different. Before making decisions about buying or selling a home, consult with your own real estate professional, lender, tax advisor, and other qualified professionals.