plan ahead

Houston first-time buyers must earn this much to afford a starter home in 2023

home interior kitchen dining 6520 Summer Pass Dr. houston

A new study reveals what first-time home buyers need to purchase homes like this, which cost around $247,000.

Photo via HAR

A new income analysis by online real estate brokerage company Redfin has revealed just how much money a potential homeowner needs to make in 2023 to afford a "starter home" in Houston. Lately, home ownership is a concept that's becoming seemingly less attainable with rising mortgage rates and increased competition among buyers.

The report revealed that first-time homebuyers need to earn $57,513 annually to afford home in Houston this year, which is 13.9 percent more income than what was required in 2022.

It's also $6,893 below the national average. According to Redfin, the average salary needed for a typical starter home in the United States is $64,403, about 13 percent more than a year ago.

These findings further confirm that affordability is one of the biggest struggles for potential buyers in the current real estate market. Median sale prices for starter homes in Houston are sitting at $217,000, and median mortgage payments are about $1,438 a month, the report said.

Redfin senior economist Sheharyar Bokhari said in the report that it's a "wild goose chase" for homebuyers seeking their first home in the current market.

"The most affordable homes for sale are no longer affordable to people with lower budgets due to the combination of rising prices and rising rates," said Bokhari. "That’s locking many Americans out of the housing market altogether, preventing them from building equity and ultimately building lasting wealth. People who are already homeowners are sitting pretty, comparatively, because most of them have benefited from home values soaring over the last few years."

Bokhari predicted the wealth gap between current and potential owners could become "even more drastic" if current trends continue.

Buyers looking elsewhere in the state might find some success. Even though the income necessary to afford a San Antonio home has risen by 18.7 percent, that only amounts to $55,657.

A first-time homebuyer would need to make $64,933 to afford a home in Fort Worth, which is 14.4 percent more than in 2022. In Dallas, potential homeowners saw a 10.6 percent increase in income needed to afford a home, making it the city with the second highest income required out of all Texas cities in the report: $72,885.

Potential homeowners in Austin saw a 3.3 percent decrease in income needed to afford a home, but it's still the highest income required out of all Texas cities in the report: $92,057.

The full report can be found on redfin.com.

Starter Home home-for-sale housing costs housing market reports sponsored section2225485804

wasting away

3,500-home community for 'active adults' approved for Galveston Bay tract

Residents of a Latitude Margaritaville community riding golf carts.

Photo courtesy of Minto Communities

The parrothead ethos lives on.

Jimmy Buffett may be gone, but the Parrothead ethos of chilling on the water lives on. Minto Communities announced this week that they would be opening Latitude Margaritaville Galveston Bay, a 3,500-home active adult community aimed at residents 55 years and older. Opening of the sales center and model park is targeted for first quarter 2028. This will be the first Latitude Margaritaville community in Texas.

“This is an exciting milestone for Minto as we expand into Texas and introduce Latitude Margaritaville to the Greater Houston market,” said Minto Communities executive Dutch Neuweiler. “We appreciate the thoughtful engagement and support of Texas City officials throughout this process and share their vision for creating a community that will have a positive impact well beyond its boundaries. With its location on Galveston Bay and access to everything the surrounding area has to offer, we believe this is an exceptional setting those interested in the iconic lifestyle our communities provide.”

The Latitude Margaritaville brand of communities launched in 2017 in Daytona Beach, Florida as part of the late singer's massive brand corporation dedicated to easy living, music, beaches, and food. Aimed at retired adults, they offer access to polls, lounges, theaters, spas, and work centers on top of prioritizing ocean views from the homes.

There should be no shortage of ways to see the water in the Galveston Bay community. The 1,318-acre property is located between State Highways 3 and 146, north of the Emmett F. Lowry Expressway and extending toward Moses Bayou. Texas City Commission has approved the Planned Unit Development (PUD) and Development Agreement (DA).

“Margaritaville has a strong commitment to Texas, and Galveston Bay is a perfect place to bring the Latitude Margaritaville lifestyle to life,” said Jim Wiseman, president of development at Margaritaville. “There’s something special about life along the Gulf — the water, the energy, the music, and that unmistakable sense that you’re never too far from a good time. Together with Minto and Texas City, we’re creating more than a community. We’re creating a place where neighbors become friends, every day feels a little more like vacation, and the Margaritaville state of mind comes naturally. We very much appreciate the positive vote and look forward to the road ahead.”

Minto Communities says the development will create 1,742 permanent jobs and generate $68.8 million in annual labor income in Galveston County. No pricing information has been provided yet, but prospective residents can find more information at LatitudeMargaritaville.com.