• First American has released its Real House Price Index, which adjusts home prices based on wages and mortgage rates.
  • In Houston, the Real House Price Index is 84.5, down 0.1 percent monthly and 0.9 percent yearly.
  • Austin has a Real House Price Index of 96.9.

First American has released the newest edition of its Real House Price Index, which reflects inflation factors such as shifts in income and mortgage rates.

According to the report, the influence of better wages and declining interest rates shows that even though prices are close to peak in many major metros, consumers are gaining buying power.

Despite reports of affordability waning in major metros across the nation, First American found real house prices are 38.5 percent below their peak seen in 2006 and 17.3 percent lower than 2000.

Without factoring income and interest rate changes, First American reports home prices are just 2.6 percent away from the 2007 housing peak.

First American says foreign financials are helping affordability in the U.S. as more investors are turning toward U.S. Treasury Bonds. As a side effect, treasury yields are keeping mortgage rates low for prospective homebuyers.

Houston affordability up, real prices down

Houston affordability

Houston affordability, marked by the RHPI, is 84.5. The new index is down 0.1 percent monthly and 0.9 percent yearly.

The RHPI is standardized at 100 and based on January 2000 real home prices. Even though Houston’s economy is currently suffering from blows due to declining oil prices, affordability for prospective homebuyers is nonetheless improving, and lower than it was before the housing crisis hit.

Nearby, Austin has a Real Price Index of 96.9, down 0.3 percent annually but up 0.3 percent monthly.

San Antonio’s Real Price Index is 88.7, down 0.8 percent year-over-year and up just 0.1 percent since last month. Each of the three Texas metros has varying degrees of real price changes, but remain lower than housing costs at the turn of the century.

Email Jennifer Riner

Show Comments Hide Comments


Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Thank you for subscribing to Morning Headlines.
Back to top
Only 3 days left to register for Inman Connect Las Vegas before prices go up! Don't miss the premier event for real estate pros.Register Now ×
Limited Time Offer: Get 1 year of Inman Select for $199SUBSCRIBE×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription