Overview
Austin is the hardest of these five cities for a first-time buyer, and the numbers show why. Unlock MLS reported a City of Austin median sale price of $570,958 for September 2026, up 4.2% from a year earlier, while the Austin-Round Rock-San Marcos metro median was $421,000 and Travis County was $497,400. Inventory sits around 5.4 months, so there is room to negotiate, but the city's down payment program only works on homes priced at $440,000 or less inside Austin's full-purpose city limits. That pushes assisted buyers toward condos and townhomes, older homes in the far north and northeast, Dove Springs and other parts of the southeast, and the east side. Many first-time buyers simply shift to Pflugerville, Manor, Del Valle or Hutto, where the county program still applies.
The City of Austin's Down Payment Assistance Program, run by the Housing Department through the Austin Housing Finance Corporation, offers up to $40,000 for down payment, closing costs and prepaids. It is a deferred, 0% second lien that is forgiven if you stay: awards under $15,000 carry a five-year affordability period and $15,000 to $40,000 ten years. You must be a first-time buyer (no ownership in three years, with divorce and displacement exceptions), earn no more than 80% of median family income ($106,800 for a family of four as of June 1, 2026), complete a homebuyer education course, and get your mortgage from a Housing-certified participating lender. Note that in August 2026 staff proposed a major FY26 overhaul, raising the maximum to as much as $88,000, adding a 15-year tier and reintroducing shared appreciation on market-rate homes; as of late October the public program page still shows $40,000, so treat the larger figure as pending. Travis County's Housing Finance Corporation offers the Hill Country Home program: a 30-year fixed FHA, VA, USDA or Freddie Mac HFA Advantage loan with 4%, 5% or 6% of the loan amount as a 0%, ten-year forgivable second, income up to $138,460, price up to $364,452, a 640 credit score, and no first-time requirement. Austin Habitat for Humanity sells new homes starting around $152,000 to buyers with a 620 score who have lived and worked locally for six months, and the Austin Community Land Trust sells renovated homes to first-time buyers under 80% MFI with appreciation capped at 2% a year.
Local Programs in Austin
Down Payment Assistance Program (DPA)
Sales price cannot exceed $440,000. First-time buyer means no home ownership in the last 3 years, with exceptions for displaced or divorced applicants. Requires a homebuyer education certificate (partner courses from Frameworks CDC or BCL of Texas cost $99 plus the NeighborWorks handbook), a mortgage from a Housing-certified participating lender, and documents including two years of W-2s/1099s and six months of bank statements. The public page does not post funding status, a minimum buyer contribution or a monthly portal schedule. An Aug 11, 2026 AHFC staff presentation proposed FY26 changes: maximum up to 20% of the HUD HOME price limit (up to $88,000), a 15-year tier for $50,000+, reintroduced shared appreciation on market-rate homes capped at the AHFC investment, a 2% simple appreciation cap on income-restricted units, and expansion to limited-purpose areas and the ETJ pending HUD approval; adoption could not be confirmed in AHFC's Aug 12, Aug 14, Aug 17, Oct 8 or Oct 22 agendas. Contact 512-974-3100 or Housing@austintexas.gov.
Hill Country Home Down Payment Assistance Program
Purchase price limit $364,452; minimum 640 FICO; maximum 45% DTI; new or existing single-family homes, condos and townhomes (no manufactured homes); principal residence with no minimum occupancy, but the second is forgiven over 10 years; purchases only, no refinances. Homebuyer education is required only for first-time buyers. Apply through one of 34 participating lenders, who screen and determine eligibility; a lender program fee may apply and rates change daily. Phone (512) 854-9116.
Austin Habitat for Humanity Homeownership Program
Requires U.S. citizenship or permanent residency, at least six months living and working in the service area, a 620+ credit score (financial counseling offered if you are below it), and no home ownership in the past 3 years (exceptions for death, divorce or natural disaster). Homebuyer education and one-on-one counseling are provided. Sweat-equity hours, mortgage terms and application windows are not stated on the page.
Austin Community Land Trust (ACLT)
Requires a HUD-certified homebuyer education course, a pre-approval letter from an ACLT-approved lender, and debt within ACLT's debt-to-income limits. Start with the online pre-certification form; income is fully verified before you pick a home. Inventory is limited and the site lists no waitlist timing.
Stacking With Texas Programs
Travis County's Hill Country Home program and the state programs (TDHCA My First Texas Home, TSAHC Homes for Texas Heroes / Home Sweet Texas) are each first-mortgage programs with built-in assistance, so you choose one of them, not two. The city's up-to-$40,000 DPA then sits behind whichever first mortgage you pick, provided your loan officer is on the city's Housing-certified participating lender list and the price is $440,000 or less. FHA is the most common base because of its 3.5% down payment; VA buyers can combine zero down with city money for closing costs.
Full details, income limits, and the federal FHA, VA, and USDA options are on the Texas first-time homebuyer programs guide. When you know what you qualify for, compare the best mortgage lenders for first-time buyers and confirm the lender is approved for the program you plan to use.
Tips for First-Time Buyers in Austin
Stacking requires one decision: Hill Country Home and the state programs (TDHCA My First Texas Home, TSAHC) are each first-mortgage programs with their own built-in assistance, so you choose one of them, not two. The city's $40,000 then sits behind whichever first mortgage you pick, as long as your loan officer is on the city's participating list. FHA is the most common base because of its 3.5% down payment; VA buyers can combine zero down with the city money for closing costs.
Practically: take the HUD-approved class early (partner courses cost $99 plus the handbook), gather six months of bank statements and two years of W-2s, and get pre-approved before you apply. The city reviews the property too, so build extra time into your contract and tell the seller you are using DPA. Funding is limited by the annual budget and is awarded in the order complete applications arrive, and the lender list is short enough that you should pick the lender before you pick the house.
The closing reality is that Austin's local help is generous relative to most cities but small relative to its prices. Under $440,000 is the constraint that shapes everything; if you can live with that, the city and county money is real and forgivable.
Frequently Asked Questions
Sources
- City of Austin Housing Department - Homebuyer Resources (Down Payment Assistance Program)
- City of Austin Housing Department - Income and Rent Limits (effective June 1, 2026)
- Austin Housing / AHFC - DPA Program FY26 Program Updates presentation (Aug 11, 2026)
- AHFC Board of Directors 2026 meeting index
- Travis County Housing Finance Corporation - Hill Country Home DPA (Homebuyers)
- Austin Habitat for Humanity - Homeownership
- Austin Community Land Trust (Austin Housing Finance Corporation)
- Unlock MLS - September 2026 Central Texas Housing Report
For educational purposes only -- not financial or tax advice. Program details, funding availability, income limits, and benefit amounts change, often mid-year. Verify everything with the administering agency before you apply. Median home price: Unlock MLS September 2026 Central Texas Housing Report, City of Austin median sale price (Travis County $497,400; Austin-Round Rock-San Marcos MSA $421,000), released Oct 13, 2026, https://www.unlockmls.com/news/september-2026-central-texas-housing-report. Last verified: October 29, 2026.