The price is not right

Texas first-time buyers need $10,000 more to afford a home this year, report shows

Texans now need $10,000 more in income to be approved for a $229,000 house.

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The hurdles are raised for first-time homebuyers in Texas yet again, as rising interest rates demand an overall higher income for mortgage approval.

The Texas Real Estate Research Center released findings in its new Texas Housing Affordability Outlook that Texans buying their first homes need $10,000 more in income than at the beginning of last year to be approved for a $229,000 house.

Purchasing power, the center explains, and mortgage interest rates are indirectly related. Higher interest means higher monthly payments; it takes a higher income to keep up. “... As long as the rise in home prices continues to outpace the increase in income, purchase affordability, or the ability of a household to buy a home, will continue to diminish,” explains the report.

The $229,000 figure represents the first-quartile home price in Texas in Q1 2022, described as "the highest home price among those lowest-priced 25 percent of homes sold" in the state. The state's median home price for the first quarter of 2022 was $319,000. Year-over-year growth was slightly higher for the median figure (18.4 percent) than first-quartile figure (17.5 percent), but both are at their highest rates since the beginning of the chart in 2012.

The Austin-Round Rock area is, of course, driving a large part of this growth, with a 29.2 percent change in first-quartile prices since Q1 2021. That figure in Austin now sits at $420,000, almost double the state's first-quartile home price. Dallas’ numbers are slightly above the state average, San Antonio’s nearly exactly match.

Houston’s are slightly below, at 17.2 percent. Here, per the report, the median home sales price was $320,000, while the first quartile sales price measured $249,000.

Unfortunately for many Texans currently renting, only 37.4 percent of them are making the qualifying income ($61,652) to buy one of those first-quartile homes with a 3.4 percent interest rate (that was the national interest rate at the beginning of the year; by mid-May the interest rate had risen to 5.25 percent).

In some good news, the report finds that from 2021 to 2022, median family income in the Houston-The Woodlands-Sugar Land MSA increased 13.8 percent. But, the report adds that if the trend in home prices outpacing the increase in income, Houstonian's ability to buy a home, will continue to diminish.

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This affluent Houston enclave is the richest small town in Texas

Facebook / City of Bellaire, Texas

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Affluent Houston neighbor Bellaire is cashing in as the richest small town in Texas for 2025, according to new study from GoBankingRates.

The report, "The Richest Small Town in Every State," used data from the U.S. Census Bureau's American Community Survey to determine the 50 richest small towns in America based on their median household income.

Of course, Houstonians realize that describing Bellaire as a "small town" is a bit of misnomer. Located less than 10 miles from downtown and fully surrounded by the City of Houston, Bellaire is a wealthy enclave that boasts a population of just over 17,000 residents. These affluent citizens earn a median $236,311 in income every year, which GoBankingRates says is the 11th highest household median income out of all 50 cities included in the report.

The average home in this city is worth over $1.12 million, but Bellaire's lavish residential reputation often attracts properties with multi-million-dollar price tags.

Bellaire also earned a shining 81 livability score for its top quality schools, health and safety, commute times, and more. The livability index, provided by Toronto, Canada-based data analytics and real estate platform AreaVibes, said Bellaire has "an abundance of exceptional local amenities."

"Among these are conveniently located grocery stores, charming coffee shops, diverse dining options and plenty of spacious parks," AreaVibes said. "These local amenities contribute significantly to its overall appeal, ensuring that [residents'] daily needs are met and offering ample opportunities for leisure and recreation."

Many popular Houston restaurants are setting their sights on this wealthy enclave. Detroit-style pizzamakers Gold Tooth Tony’s opened its second pizza joint in Bellaire in 2024. And most recently, Michelin-recognized Tex-Mex restaurant Candente announced it would open a second location just down the street from Gold Tooth Tony's at 5101 Bellaire Blvd.

Earlier in 2025, GoBankingRates ranked Bellaire as the No. 23 wealthiest suburb in America, and it's no stranger to being named on similar lists comparing the richest American cities.

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