Houston is one of the few major cities where owning a home is still within reach for the average worker.
Homeownership costs are below the affordability threshold of 28 percent of income in just five large counties in the U.S., including Houston’s Harris County, the Houston Chronicle reported, citing ATTOM Data Solutions.
Based on a median home price of $318,750, an average annual income of $85,800, and a 20 percent down payment, Harris County homeowners could spend about 25 percent of their pre-tax income on mortgage payments, property taxes and insurance.
This affordability sets the county apart from many other regions in the U.S., where home prices have outpaced income growth, said ATTOM CEO Rob Barber.
“Home affordability continues to show signs of easing, which lightens the pressure on house hunters struggling to find a place that fits their budget,” he said, adding that while the cost of owning a home still presents challenges, the overall market is “at least tracking in the right direction.”
Houston’s affordability contrasts with other Texas regions, such as Austin’s Travis County, where the average debt-to-income ratio for home buying is 38.5 percent, five percentage points higher than the national average. While Austin has seen slight improvements, it remains significantly less affordable compared to Houston.
Among large U.S. counties, only Detroit (17 percent), Philadelphia (20.7 percent), Cleveland (21.1 percent), and Pittsburgh (22.3 percent) join Harris County in maintaining affordable homeownership ratios. Smaller cities in Texas, including Amarillo, Beaumont and Midland also fall within affordable ranges.
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Houston’s relatively affordable housing market is further bolstered by local wage growth. While home prices in Harris County increased by 2.9 percent in the third quarter of last year, wages rose by 2.7 percent, helping to keep affordability within reach. The county’s affordability index improved by 3 percent from the second quarter and by 11 percent year-over-year.
As mortgage rates continue to stabilize, Houston’s housing market could remain a key option for homebuyers seeking affordability in an increasingly expensive and competitive national landscape.
— Andrew Terrell