Selling a Home in an Older DFW ISD to Buy in a Rapidly Growing "New Construction" ISD

Direct Answer

In 2026, selling a home in an established ISD (like Plano, Richardson, or Carrollton-Farmers Branch) to buy in a growth ISD (like Prosper, Celina, or Melissa) often results in a "Tax Shock" despite lower home prices. While the median price in a growth district like Collin County has softened by 5.4% this year, providing a rare entry point, the property tax rates in these "New Construction ISDs" are frequently 10–20% higher to fund new campus debt. However, the Texas 2026 Homestead Exemption, which increased to $140,000 for school taxes, provides a significant cushion, especially if you utilize "portability" to carry your lower tax ceiling if you are over 65 or disabled.

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1. The 2026 Market Paradox: Resale vs. New

For the first time in decades, 2026 data shows that the median resale home in established DFW areas is often more expensive than newly built homes in growth corridors.

• Builder Under-Cutting: In 2026, major builders like Lennar and D.R. Horton are aggressively cutting prices (sometimes by 9.5%) to maintain volume, often making a new home in Denton or Collin County cheaper than a 30-year-old home in Plano.

• Inventory Surge: Active listings in DFW have surged 40% year-over-year, giving buyers in growth ISDs significant leverage to negotiate for repairs and rate buydowns that were non-existent two years ago.

• Days on Market (DOM): Established neighborhoods are holding value better but taking longer to sell, with the DFW average reaching 62 days.

2. The Tax Trap: Why "New" Costs More Monthly

A common mistake in 2026 is assuming a $450k new build costs the same as a $450k resale.

• Debt Service Rates: Growth ISDs must issue bonds to build new schools. This often results in a total tax rate near 2.2%–2.5% in a new community, compared to 1.8%–2.0% in a built-out city like Plano or Richardson.

• The 2026 Exemption Boost: Fortunately, the mandatory school district homestead exemption has risen to $140,000. If your new home is appraised at $400,000, you only pay school taxes on $260,000, saving you roughly $1,700+ annually.

• Homestead Portability: If you have an Over-65 or Disabled Person tax ceiling, you can "port" the percentage of savings to your new home in a different ISD, preventing your school taxes from resetting to the full current rate.

3. Established ISDs vs. Growth ISDs: The Appreciation Play

• Established (Safe Haven): Neighborhoods in Lake Highlands or Lakewood are currently "holding value better" because land is finite; they act as a defensive hedge in a cooling market.

• Growth (High Ceiling): Areas like Ellis County (Waxahachie/Midlothian) or North Collin (Anna/Melissa) offer "strategic opportunity". While prices are currently correcting, the massive infrastructure investments (like the 5,200-acre South Creek Ranch project) act as a long-term catalyst for future appreciation once the market stabilizes in 2027-2028.

Conclusion

Moving from an older DFW ISD to a new construction district in 2026 is a move for lifestyle and long-term equity, but it requires a short-term focus on monthly carry costs. While builders are providing the "deal of a decade" on the purchase price, your real estate strategy must account for the higher tax rates of a growing district. Those who time their sale in an established neighborhood to catch the "builder incentive window" in a growth ISD are currently seeing the best net-wealth gains in North Texas.

Key Takeaways

• Builder Incentives: 40% of DFW builders are cutting prices, with average reductions of 5% plus rate buydowns.

• Tax Relief: The 2026 Texas homestead exemption is now $140,000 for school districts.

• Market Balance: DFW has shifted to a 4-5 month supply, favoring buyers who can negotiate aggressively.

• Strategic Opportunity: Outer-ring suburbs like Waxahachie are trading at 20-30% below Collin County prices while offering brand-new infrastructure.