Here's the salary you need to make to comfortably afford a home in Houston, study says

HOUSTON — Affording a home in today's market is a real challenge for first-time buyers thanks to soaring prices and high interest rates. 

The average annual salary that homebuyers need to comfortably afford a home -- paying no more than 30% of their income -- has shot up dramatically since 2020, according to a Zillow analysis.

In January 2020, a household earning $59,000 annually could comfortably afford the monthly mortgage on a typical U.S. home. That was below the U.S. median income of about $66,000, meaning more than half of American households could swing the monthly payment. 

Home shoppers today need to make on average more than $106,000 to comfortably afford a home, according to Zillow. That's 80% more than four years ago and well above the median income of an estimated $81,000.

"Housing costs have soared over the past four years as drastic hikes in home prices, mortgage rates and rent growth far outpaced wage gains," Zillow's Orphe Divounguy said. "Mortgage rates easing down has helped some, but the key to improving affordability long term is to build more homes."

A monthly mortgage payment on a typical U.S. home is now $2,188 (assuming a 10% down payment), nearly double the average cost in January 2020.   

Home values are up 42.4% over four years, with the typical U.S. home now worth about $343,000. Higher home values also mean higher property taxes and insurance rates.

How Houston compares with other Texas cities 

Houstonians who dream of owning a home are in better shape than the national average but the numbers are still discouraging. 

• The income needed to comfortably afford a home in Houston is now $95,374, Zillow says. That's $39,779 higher than 2020. 
• H-Town is virtually tied with San Antonio where the necessary salary is $95,767, up $38,307 in four years. 
• Dallas is a different story. You'd need to make $121,398 there to comfortably afford a home, up $53,679 from 2020.
• The worst large Texas city for home ownership is Austin, according to Zillow. You'll need a whopping $149,267 annual salary to comfortably afford a home there, up $65,144 from four years ago.

The least affordable cities to own a home

Zillow says homebuyers in these seven cities need an annual salary of over $200,000 or more to comfortably afford a typical home.

1. San Jose, CA: $454,296
2. San Francisco: $339,864
3. Los Angeles: $279,250
4. San Diego: $273,613
5. Seattle: $213,984
6. New York City: $213,615
7. Boston: $205,253

The most affordable large cities to own a home

1. Pittsburgh: $58,232
2. Memphis: $69,976
3. Cleveland: $70,810
4. New Orleans: $74,048
5. Birmingham: $74,338

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