What 7% Mortgage Rates Really Cost on a Houston Home (2026)

Mortgage rates are the number one question we get from buyers right now. Here is what today's rates actually mean for your monthly payment on a typical Houston-area home, and what you can do about it. Questions? Contact us or call 713-996-9755. Se habla español.

Monthly Payment at Today's Rate (7.4%)

Home price	Principal and interest	Property taxes	Insurance	FHA mortgage insurance	Total per month
$250,000	about $1,700	about $520	about $180	about $110	about $2,510
$325,000	about $2,210	about $680	about $230	about $145	about $3,260
$400,000	about $2,720	about $830	about $280	about $175	about $4,010

Estimates by My City Homes Realty: FHA loan, 3.5% down, 1.75% upfront mortgage insurance financed, 30-year fixed at 7.40%, property taxes at 2.5% of price, homeowners insurance at about 0.85% of price a year, annual FHA mortgage insurance at 0.55%. Your rate, taxes and insurance will differ. Not a loan offer.

What a Lower Rate Would Save

Home price	Principal and interest at 7.4%	At 6.4%	At 5.4%
$250,000	about $1,700	about $1,535	about $1,380
$325,000	about $2,210	about $2,000	about $1,790
$400,000	about $2,720	about $2,460	about $2,205

On a $325,000 home, the difference between 7.4% and 6.4% is about $210 a month, or about $77,000 in interest over 30 years. Put another way, a $2,000 principal-and-interest budget buys a loan of about $289,000 at 7.4%, but about $320,000 at 6.4%.

Should You Wait for Rates to Drop?

Nobody knows exactly where rates will go. What we do know about the Houston market right now:

• Buyers have more choices. Greater Houston had about 5.5 months of inventory in September 2026, and homes took about 58 days to sell (HAR). See is Houston a buyer's market?
• Sellers are negotiating. In a slower market, many sellers will pay part of your closing costs or a rate buydown, which can lower your payment more than waiting a few months.
• You can refinance later. If rates fall after you buy, you may be able to refinance. If prices rise while you wait, you cannot get that back.
• Rent keeps going up too. The average Houston single-family rent was $2,333 in September 2026 (HAR). See rent vs. buy in Houston.

4 Ways to Lower Your Payment Today

1. Ask for a seller-paid rate buydown. A 2-1 buydown can lower your rate by 2 points the first year and 1 point the second.
2. Use down payment assistance. Texas and local programs can help with the down payment and closing costs. See Houston first-time buyer assistance.
3. Watch the property tax rate. MUD taxes can add hundreds a month. Compare rates before you choose a neighborhood, and file your homestead exemption. See MUD taxes explained.
4. Look at lower-priced areas. Pasadena had about 100 homes under $250,000 in October 2026, and 77089 and South Houston also have many homes under $300,000.

Get Your Real Number

The fastest way to know your payment is to get pre-approved. Our preferred lender can quote FHA, VA, conventional and ITIN loans. Get pre-approved here, or ask us to run the numbers on a specific home.

FAQ

What is the mortgage rate today?

Freddie Mac reported an average 30-year fixed rate of 7.40% and a 15-year rate of 6.71% for the week of October 15, 2026. Your rate depends on your credit, down payment and loan type.

What is the monthly payment on a $325,000 house in Houston?

At 7.4% with an FHA loan and 3.5% down, about $2,210 in principal and interest, or about $3,260 a month with taxes, insurance and mortgage insurance.

How much does a 1% lower mortgage rate save?

On a $325,000 Houston home with an FHA loan, a rate 1 point lower saves about $210 a month and about $77,000 in interest over 30 years.

Sources: Freddie Mac Primary Mortgage Market Survey, October 15, 2026; HAR newsroom, September 2026 market and rental reports. Payment estimates by My City Homes Realty.