Updated 2026 · Based on median market data for Abilene, TX
The effective property tax rate in Abilene, TX is 1.72%. On the median home price of $205,000, that's an annual tax bill of approximately $3,526 — or $294/mo. This is significantly above the national average and represents one of the largest operating expenses for landlords here.
Property taxes consume 16.6% of gross rental income in Abilene. At 15-20% of gross rent, taxes are a significant expense that meaningfully compresses margins. Make sure to account for this in your underwriting. Without property taxes, the cap rate would be 8.96% — the 1.72% tax rate reduces it to 7.24%, a drag of 1.72 percentage points.
Property tax bills are based on assessed value, which may differ from market value. In many jurisdictions, assessed values lag behind market prices, meaning your actual tax bill after purchase could increase once the property is reassessed. In TX, check whether purchases trigger automatic reassessment — if so, budget for taxes based on your purchase price, not the seller's current bill. Also investigate whether TX offers any homestead exemptions that landlords would NOT qualify for, as this could increase your effective rate.
In high-tax markets like Abilene, consider: (1) appealing your assessment if the property is over-valued, (2) purchasing below market value through off-market deals, which can lock in a lower assessed value, (3) factoring tax increases into your rent escalation clauses, and (4) comparing properties in adjacent jurisdictions where rates may differ.
Abilene vs Texas state average and national average across key investment metrics. Abilene outperforms both benchmarks on cap rate.