Rising Interest rate challenges Houston Housing Affordability – Report Housing Affordability Index

As per the report released for Q3 2022 by HAR team, housing affordability remains a challenge for homebuyers in the Greater Houston area amid a backdrop of slowing home sales, moderating home price appreciation and higher mortgage rates. Fewer households could afford to purchase a median-priced home in the third quarter of 2022 compared to a year ago, according to the report.

The median home price in the Houston area grew 12.8 percent to $349,500 in the third quarter of 2022. Forty-one percent of households in the Houston area earned the minimum annual income needed to purchase a home at the median price. That’s down from 53 percent in the third quarter of 2021. The monthly mortgage payment on a 30-year, fixed-rate loan, including taxes and insurance, rose to $2,250 from $1,590 a year ago. As a result, Houston-area homebuyers needed to earn 41.5 percent more income annually than they did a year ago to afford a median-priced home. 

See chart show year over year numbers,

This index really shows how the market has changed from last year with price increase and now with rate increase making many low income people not able to afford housing and pushing them to rent.

Please read full report here, https://www.har.com/content/department/newsroom?pid=1897

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