How to read this chart: An increasing price-income ratio, such as occurred from 2001 through 2005, is a signal of the rising cost of purchasing a house. A high price-to-income ratio over an extended period could suggest that sellers are pricing homes based on unrealistic income-growth expectations in the future — which is one indication that house prices are overvalued and due for a correction.

About the ratio: The price to income ratio is calculated quarterly and has two inputs: median home price and average* household income. The ratio is calculated using the following formula: Price-to-income ratio = median home price / average household income

Data Sources: The median home price is sourced from the National Association of Realtors median home price data as well as Moody's Analytics estimates. Average household income is calculated as: Average income = total personal income / number of households.

* Other sources calculate this using the median family income instead of the average

Data provided through Sept. 30, 2022 and includes Houston, The Woodlands and Sugar Land.