Housing affordability declined for all ethnic groups in the Houston area as interest rates skyrocketed in 2023. However, the affordability gap widened for Black and Hispanic/Latino homebuyers, according to the Houston Association of Realtors’ (HAR’s) inaugural Housing Affordability by Ethnicity report.

The report uses HAR’s Housing Affordability Index (HAI) to measure the percentage of households for each ethnic group that can afford to purchase a median-priced, single-family home in the Houston area.

Forty percent of households in the metro area earned a minimum income of $105,200 needed to purchase a $336,000 median-priced home in 2023, according to HAR’s HAI. That is down from 44 percent in 2022.

When analyzed by ethnicity, the data reveal that one in four Hispanic/Latino households in the Houston area earned enough income to buy a median-priced home in 2023. That is down from 28 percent in 2022. Only a few more Black households, 26 percent, could afford an equally priced home last year compared to 34 percent the prior year. Fifty-one percent of Asian and White households could afford to buy a median-priced home in 2023 compared to 58 percent a year earlier.

“High interest rates have put the American dream of homeownership further out of reach for all ethnic groups, especially Black and Hispanic/Latino consumers—groups that have historically struggled to buy a home,” said HAR Chair Thomas Mouton with Century 21 Exclusive Properties. “This underscores the need for equitable solutions to ensure that every family has access to affordable housing, regardless of race or ethnicity.”

The chart below shows the percentage of households for each ethnic group that could afford to purchase a median-priced home based on the minimum qualifying annual household income required and a 20 percent down payment.