Housing affordability is broadly defined as the ability of a household (or family) earning the median income to qualify for the median-priced home. The fundamental determinants—home price and household income—have diverged since the recovery from the Great Recession, causing national and statewide declines in housing affordability. The Real Estate Center’s Housing Affordability Index employs median family income relative to the median home price. Another measure of affordability, the Texas Affordability Pyramid (the pyramid), estimates the number of households that can afford to purchase a home at specific price intervals based on household income.
Gaines, James P, and Clare Losey. “How Much Home Can a Household Afford.” Tierra Grande Journal of the Real Estate Center at Texas A&M University, pp. 7–13, assets.recenter.tamu.edu/Documents/Articles/2188.pdf.