Texas Housing Market Report 2026

What Home Buyers Need to Know

Updated January 2026 | Texaslending.com

The Texas housing market continues to be one of the most dynamic real estate environments in the nation. Whether you’re a first-time buyer searching for FHA loans Dallas TX, a homeowner exploring Texas home refinance options, or looking to tap into your home equity in Texas, understanding current market conditions is essential for making smart financial decisions.

This comprehensive report from Texaslending breaks down everything you need to know about buying, refinancing, and building wealth through homeownership in the Lone Star State.

Current Texas Housing Market Data: January 2026

The Texas real estate market has shifted into a more balanced state after years of rapid price increases. According to the Texas Real Estate Research Center and recent market analysis, here’s where things stand:

Statewide Market Snapshot

The median home price in Texas currently sits around $340,000 to $350,000, representing modest year-over-year growth compared to the double-digit increases seen during the pandemic years. This stabilization is welcome news for buyers who have struggled with affordability concerns.

Housing inventory has improved significantly, reaching approximately 5.5 months of supply statewide. This shift from the extreme seller’s market conditions of recent years means buyers now have more negotiating power and breathing room to make informed decisions.

Homes are spending a median of 60 to 72 days on market before going under contract, compared to the frenzied days when properties received multiple offers within hours of listing.

Regional Market Breakdown

Metro Area	Median Price	Months Supply	Market Trend
Dallas-Fort Worth	$440,000	3.4 months	Balanced
Houston	$370,000	4.3 months	Buyer-Friendly
Austin	$499,000	3.7 months	Correcting
San Antonio	$335,000	4.2 months	Buyer-Friendly

Dallas-Fort Worth maintains strong activity with a median list price around $440,000. The market shows approximately 3.4 months of supply, making it relatively balanced. For those researching Dallas refinance rates or home equity loan Dallas Texas options, the region’s stable values provide solid equity positions for many homeowners.

Houston leads Texas in total listings and sales volume with a median price around $370,000. Those exploring cash out refinance Houston opportunities may find current conditions advantageous.

Texas Mortgage Rates: Current Trends and Outlook

Understanding Texaslending rates and the broader mortgage market is crucial for anyone considering a home purchase or refinance. As of January 2026, mortgage rates have shown encouraging improvement:

Current Rate Environment

The mortgage rate in Texas currently averages around 5.75% APR and 6.75% APR, representing a significant decrease from the 7%+ rates seen in late 2023 and early 2024. According to Freddie Mac’s Primary Mortgage Market Survey, the 30-year fixed rate averaged 6.06% for the week ending January 15, 2026—the lowest level since September 2022.

For those exploring shorter terms, the 15-year fixed rate is about .25% lower than the 30 year rate, offering interest savings for buyers who can handle higher monthly payments.

What Rates Mean for Your Budget

Using a mortgage calculator Texas tool to understand your purchasing power is essential. At current rates with Texas’s median price of approximately $340,500, you can calculate your expected mortgage principal and interest payment.

Home Refinance Rates in Texas: Opportunities for Current Homeowners

Homeowners who purchased during the rate peak of 2023 may find significant savings by exploring current home refinance rates in Texas. If your current rate is near 8% and were able to refinance to rate nearly 2% lower, the monthly savings on a $300,000 loan would be approximately $400 per month.

Understanding Texas Home Equity Lending

Texas has unique regulations governing home equity loans in Texas and Texas home equity lending under Section 50(a)(6) of the Texas Constitution. These protections apply to both home equity loans and HELOCs:

• 80% LTV Cap: Home equity loans cannot exceed 80% of your home’s fair market value

• One Loan at a Time: Only one home equity loan can be outstanding on your primary residence

• 12-Day Waiting Period: Mandatory cooling-off period between application and closing

• Closing Location: Must occur at lender’s office, attorney’s office, or title company

• 2% Fee Cap: Lender fees capped at 2% of loan amount (excluding appraisal and title fees)

• 3-Day Rescission: Borrowers can cancel within 3 business days after closing

• No Prepayment Penalties: Texas law prohibits early payoff fees

FHA Loans Dallas TX and Statewide: First-Time Buyer Programs

For buyers who don’t have large down payments or perfect credit, FHA loans Dallas TX and throughout Texas remain an excellent pathway to homeownership.

2026 FHA Loan Limits for Texas

The Federal Housing Administration has set loan limits that vary by county. For most Texas counties in 2026, the FHA loan limit is $541,287 for single-family homes. High-cost areas like some Dallas-Fort Worth suburbs may have higher limits.

FHA Program Benefits

• Down payments as low as 3.5% for buyers with credit scores of 580 or higher. Conditions apply depending on lender, total credit profile, debt to income ratio, loan term, fha loan program, interest rate and more.

• More flexible credit requirements than conventional loans

• Ability to include closing costs in financing through seller concessions

• Competitive interest rates that often match or beat conventional offerings

Working with Home Lenders Texas: Choosing the Right Partner

Selecting among home lenders Texas options requires evaluating several factors beyond just interest rates:

Local expertise matters. Texas mortgage regulations, particularly around home equity lending, differ from other states. Working with lenders who understand Texas-specific requirements ensures smooth transactions.

Communication and responsiveness make a significant difference during what can be a stressful process.

Total cost comparison should include not just rates but also closing costs, points, and any lender fees.

Home Buyer Outlook: Is 2026 a Good Time to Buy in Texas?

The current market conditions present several advantages for Texas home buyers:

• More negotiating power exists than at any point in recent years

• Price stability after years of rapid appreciation means you’re less likely to overpay

• Improved rates compared to 2023-2024 peaks make monthly payments more manageable

• Long-term investment potential in Texas remains strong with continued job growth and population increases

Conclusion: Your Path Forward in the Texas Housing Market

The 2026 Texas housing market offers genuine opportunities for both buyers and homeowners. Whether you’re exploring FHA loans Dallas TX, considering a cash out refinance Houston property, or evaluating home equity loans in Texas, current conditions favor thoughtful decision-making without the pressure of pandemic-era competition.

Getting pre-approved is the essential first step for any home purchase. Pre-approval establishes your budget, demonstrates seriousness to sellers, and accelerates the closing process once you find the right property.

Ready to Take the Next Step? Contact Texaslending at 800-346-8047 Visit texaslending.com/get-started to begin your pre-approval process