Houston, Texas Mortgage Calculator

Houston median home prices reach $327,000 in 2025, most affordable major Texas metro (versus Austin $440K, Dallas $425K). River Oaks luxury estates command $2M-$10M+ (Houston's most exclusive), Memorial $450K-$1.2M (upscale west), Galleria/Uptown $350K-$700K (urban high-rise), Heights $400K-$650K (trendy inner loop). Affordable areas: Katy $320K, Sugar Land $380K, Pearland $310K, Cypress $340K. Inventory at 4.6 months (12-year high) creating buyer-favorable balanced market. Homes averaging 45-55 days on market.

For Houston's $327,000 median, buyers need $85,000-$95,000 annual household income with 20% down ($65,400). Monthly costs run $2,300-$2,600 including mortgage, 1.65% property tax (high but offset by zero state income tax), insurance, flood insurance ($85/month many areas). Texas has no state income tax - saving $3,000-$5,000 annually versus similar-priced markets. Strong employment from energy sector (ExxonMobil, Chevron, Shell), healthcare (Texas Medical Center largest in world), aerospace (NASA Johnson Space Center), and port/logistics supports accessible homeownership.

Houston property tax averages 1.65%, among Texas's highest (Harris County). On $327,000 home, expect $5,396 annual property tax. While exceeding national average (0.99%), this trades off against Texas's zero state income tax. Property tax funds Houston ISD schools, Metro transit, flood control, infrastructure. Homestead exemption provides $100,000 school tax reduction plus 20% general homestead, saving $2,500-$3,000 annually. Over-65 homeowners freeze school taxes. Factor flood insurance ($85-$200/month) for many areas given hurricane/flood risk.

Value-conscious Houston buyers target: Pearland $310K (south family suburbs), Katy $320K (west excellent schools), Humble $280K (northeast affordable), Cypress $340K (northwest growth), Missouri City $330K (southwest diverse). Inner city: East End $290K (gentrifying), Third Ward $280K (urban revival), Greater Heights $400K (trendy premium). These areas offer accessibility, good schools, and appreciation potential. Avoid premium River Oaks ($2M+), West University ($1M+), Memorial Villages ($800K+) unless high budget. Houston's sprawl creates numerous affordable suburban options.

Houston shows strong buyer-favorable conditions in 2025. Inventory at 4.6 months (12-year high), prices declined 2.1% year-over-year, homes averaging 45-55 days on market. More negotiating power than competitive pandemic years. Market remains fundamentally strong: energy sector dominance (oil/gas headquarters cluster), Texas Medical Center (world's largest), NASA presence, Port of Houston (nation's busiest), no state income tax attracts relocators. Forecast 3-5% appreciation through 2026 as market normalizes. Excellent opportunity for buyers seeking affordability in major diverse metro.

With a $70,000 annual salary, you can typically afford a home priced between $210,000-$280,000, assuming good credit, 20% down payment, and following the 28/36 debt rule. Use our calculator above for your exact situation.

Minimum credit scores vary by loan type: Conventional loans require 620+, FHA loans accept 580+ (or 500+ with 10% down), VA loans have no minimum but lenders typically want 620+, and USDA loans need 640+.

A 20% down payment eliminates PMI requirements, which typically costs 0.5-1% annually. However, many buyers purchase with less down. This is educational information - evaluate your specific situation and consult professionals.

Closing costs typically range from 2-5% of the home price. On a $300,000 house, expect $6,000-$15,000 in closing costs including appraisal, inspection, title insurance, and lender fees.

A fixed-rate mortgage has the same interest rate for the life of the loan, meaning your monthly principal and interest payments are stable. An adjustable-rate mortgage (ARM) has a rate that changes periodically, so your monthly payments could increase or decrease.

To improve your DTI ratio, you can either increase your income or decrease your debt. Consider strategies like paying down high-interest loans, avoiding new debt, and exploring opportunities to boost your earnings.

A home appraisal is a professional assessment of a property's value. It is important because lenders use it to ensure they are not lending more money than the property is worth. A low appraisal can impact your ability to secure a loan.

A 15-year mortgage typically has a lower interest rate and you will pay less interest over the life of the loan. However, the monthly payments are higher. A 30-year mortgage has lower monthly payments, but you will pay more in interest over time.