The Houston housing market has been booming with healthy sales and prices for a couple of years now, but a new report looks at just how truly affordable the average home is. The financial advice portal SmartAsset has released its rankings of the best and worst major cities in America for home affordability. The criteria for the list went beyond prices and sales trends. "We looked at the median household income, we looked at the average non-mortgage debt in the area, we looked at the median home value, and we looked at down payment," says AJ Smith, Vice President of Financial Education at SmartAsset.
What they found is that the Houston area, despite rising home prices, is still among the most affordable based on the median income. The Houston-The Woodlands-Sugar Land metro area ranked fifth best on the affordable list. The median household in Houston can afford a home worth $206,000, while the median home value in Houston is $193,000.
Smith tells KTRH they want to show people there are other factors besides price when it comes to buying a home. "You can't just look at housing prices," she says. "Yes, you may find an area that has cheap housing, but if you're getting paid even less, it's going to be hard to live there."
SmartAsset recommends looking beyond prices and sales trends when you're buying a home. "Think about things like taxes--property taxes, think about down payment versus how much you can afford on a monthly basis," says Smith. "You may hear things like we're in a buyers’ market or we're in a sellers’ market, and that's all well and good, but it's really important to take a look at what your situation is, because that will ultimately determine how much home you can buy, and whether you can buy a home."