We it might seem like Houston home prices are steep, a new study shows that a median-priced home in the Bayou City is actually much cheaper than homes in many other parts of the country, and they require a lower salary to purchase and maintain payments.

HSH.com — a mortgage tracking site — calculated the annual before-tax income required to cover a median-priced home's mortgage principal, interest, tax and insurance payments in 27 major U.S. cities. The mortgage research company based estimates on the National Association of Realtors' fourth-quarter data for median home prices and used its own data on average interest rates for 30-year, fixed-rate mortgages and a 20 percent down payment (although the author notes it's possible to buy a home with a down payment below 20 percent).

In Houston, the annual income needed to afford a median-priced home is $49,983.37, making it the 13th most expensive out of the 27 cities on the list. With that salary, an individual could afford a $199,300 home with an average monthly payment of $1,166.28.

"Quarterly price declines continued in Houston, but it remains the most expensive Texas metro on our list," writes Tim Manni of HSH.com. "Yearly price growth in the Houston metro continues to lead the pack among the Texas three (including Houston, San Antonio and Dallas). Last quarter, Houston realtors reported that home prices were returning to more normalized levels. The same trend seemed to hold true during the fourth quarter as well."

In Houston, the annual income needed to afford a median-priced home is $49,983.37, making it the 13th most expensive out of the 27 cities on the list.
Of the cities profiled within Texas, San Antonio ranked as the most affordable with payments falling just above the $1,000 mark and the necessary income to afford a median-priced home — costing $185,000 — coming in at $45,374.30 annually. In Dallas, the median price for a home is $189,600, requiring a salary of $48,786.53.

While you might assume that New York City would have the highest salary needed for a median-priced home, San Francisco is actually No. 1. The median price for a home there is a stunning $742,900, which requires a salary of at least $142,448.33 to make the necessary monthly payments of $3,323.79.

New York City actually came in at No. 4 on the list of metro areas profiled, with a median home price of $390,000 and a required salary of at least $87,535.60 to afford such a home.

The study also identified several emerging trends in real estate.

"Home prices in metro areas throughout the country continue to show solid price growth, up 25 percent over the past three years on average," said Lawrence Yun, chief economist for the National Association of Realtors. "Low interest rates helped preserve affordability last quarter, but it'll take stronger income gains and more housing supply to help meet the pent-up demand for buying."

In terms of homes nation wide, which are down in cost by 20 percent, a buyer would need an annual salary of $48,603.82 to purchase the median-priced American home.

By: Elizabeht Rhodes culturemap.com