Side-by-side comparison of mortgage costs, property taxes, closing costs, and homeowners insurance between South Dakota and Texas. Updated for 2026.
South Dakota wins 5 of 6 cost categories, making it the more affordable state for homebuyers overall. With a median home price of $295K and lower overall costs, South Dakota offers meaningful savings compared to Texas. Both states offer first-time buyer programs — explore the state pages for full details.
Estimated PITI payments assuming 10% down, 6.5% rate, 30-year fixed mortgage with PMI.
The monthly payment difference is $381/month — that’s $4,572/year or $137K over the life of a 30-year loan. Buying in South Dakota is the more affordable option based on median home prices with identical loan terms.
Based on the 28% debt-to-income rule — your monthly housing payment should not exceed 28% of gross monthly income.
To afford the median home in Texas, you need a household income of approximately $114K/year. In South Dakota, you need $98K/year — less by $16K/year. The $16K difference is meaningful but manageable for dual-income households.
Home prices in South Dakota and Texas are relatively close, with only a 5% difference ($15K). At similar price points, your decision should focus on the other cost factors: property taxes, insurance, closing costs, and the overall quality of life each state offers. Small percentage differences in tax rates compound over decades of homeownership.
South Dakota has a moderate property tax advantage at 1.22% versus Texas's 1.8%. While the rate gap of 0.58% may seem small, it translates to an annual difference of approximately $1,981 when applied to each state's median home price. Over a typical homeownership period of 7-10 years, that adds up to $16K in savings.
Insurance costs favor South Dakota at $2,300/year versus $3,800/year in Texas, a difference of $1,500 annually. While not the largest cost factor, this adds up to over $15K over a decade of homeownership. Shop multiple carriers in either state — actual premiums depend on your specific property, coverage level, and claims history.
Closing costs are a one-time but significant expense. Texas averages $5K in closing costs (1.7% of purchase price) while South Dakota averages $2K (0.7%). The difference is spread across title insurance, attorney fees, and recording costs rather than a single large tax. Budget for these upfront costs — they affect how much cash you need on hand at closing.
Both states offer down payment assistance for first-time buyers. South Dakota's SDHDA First-Time Homebuyer provides Fixed-rate FTB loans, while Texas's TDHCA My First Texas Home offers Up to 5% DPA grant. These programs can significantly reduce your upfront costs and make homeownership accessible even if you haven't saved a full 20% down payment. Check eligibility requirements on each state's housing finance agency website — income limits and purchase price caps apply.
The bottom line: South Dakota and Texas are broadly similar in housing costs, with only $381/month separating them in total PITI payments. In cases like this, your decision should be driven by lifestyle preferences — job opportunities, climate, proximity to family, and quality of life — rather than pure cost savings. Either state offers a reasonable path to homeownership.