Many Houstonians Not Earning 'Comfortable' Income To Meet Needs

Houston has managed to long remain one of the more affordable large metros, especially when compared to other cities atop the list. New York, Los Angeles, Philadelphia, and Chicago all have some sky-high prices, and Houston has avoided the surge those cities have seen in cost. But that does not mean Houston is cheap by any means, and anyone who lives in the city knows it is not.

Part of that blame is at the federal level, thanks to years of President Biden running the economy into the ground. But part of it is also the Houston economy and income structure itself. A new analysis from SmartAsset finds that a single adult needs $90,000 a year to live comfortably in Houston. Considering the median income is about $60,000 a year in Houston, that number seems unreachable to most.

The city ranks 15th out of the top 100 U.S. cities in terms of affordability. Economist Hank Lewis says while Houston is in a fine spot economically, it is not without some persistent issues.

"Houston is one of the least expensive of the top ten major U.S. cities to live in, but we have been facing some rising housing costs," he says.

Just buying a home right now is unaffordable, thanks to high prices, low supply, and high interest rates. So that leaves people renting, which has also seen a steady increase in price in recent years.

In theory, with $90,000 a year, you would make around $6,000 per month. By using the age old 50-30-20 breakdown of finances. That is, 50 percent for housing and necessities, 30 for entertainment, and 20 percent for savings. But when factoring in the expense of rent in Houston, that starts getting stretched thin.

"The average rent for a one-bedroom apartment is in the $1,500 range...so $3,000 a month to cover expenses is reasonable, but what if you have a car note?" says Lewis.

It does not get any easier when you factor in other things either.

"You throw in a student loan, and suddenly that $3,000 for living expenses is probably not going to be enough," Lewis says.

For families, the bar for comfortability goes much higher, needing about $206,000 a year. Again, considering the median income of the city, most fall well short of that mark.

Lewis adds that employers get away with underpaying in Houston because of the lower cost of living.