Houston's $205.5 million payroll is over the $200.4 million luxury tax line but under the $209.0 million first apron. The real squeeze comes in 2027-28, when Amen Thompson's salary jumps from $12.3 million to $35.9 million.
Oct. 19
Houston waived Sean Pedulla and moved Oscar Tshiebwe and Julian Phillips to two-way deals, each at $2.5 million on this season's books. The low end of the roster is all near-minimum money: Isaiah Crawford, Jae'Sean Tate and Bogdan Bogdanovic each sit at $2.4 million, and rookie Bruce Thornton at $1.4 million. The bench is cheap because the top five salaries take up most of the 16 contracts' total.
This season
Kevin Durant at $43.9 million and Alperen Sengun at $35.6 million lead the payroll, followed by Fred VanVleet at $25.0 million, Smith at $23.6 million and Tari Eason at $14.1 million. Houston is well past the $165.0 million cap, so any addition this season has to fit under the $209.0 million first apron. The second apron, at $221.7 million, is farther off. The Dream Shake argued this week that Houston's title window just broke wide open.
This week
Injuries are testing what that money buys. Steven Adams, paid $13.0 million, has an estimated return of Nov. 2 from a right calf injury, and The Dream Shake reported he will miss time. Smart, at $6.1 million, went from day-to-day back to out on Wednesday with his left forearm injury. Sengun's back has him out too. Both are estimated to return Oct. 30.
Next summer
VanVleet's $25.0 million player option is the swing contract. Houston has no 2027-28 money committed to him, Tate, Bogdanovic, Tshiebwe or Phillips. Smith's salary drops to $21.8 million, but Durant's rises to $46.1 million, Sengun's to $37.3 million, Thompson's to $35.9 million and Reed Sheppard's to $14.0 million. Smart has a $6.4 million player option of his own that year.
2027 to 2030 drafts
Houston has few picks to trade. It owns its 2028 and 2030 first-round picks outright, but its 2027 and 2029 firsts are tied up in swaps. Its seconds are scarcer still: the 2028 pick goes to Charlotte, the 2029 pick goes to Memphis, and the 2027 and 2030 picks are swaps. With Durant at 38 and the payroll over the tax line, any flexibility will have to come from salaries, not draft capital.
Are the Rockets over the luxury tax in 2026-27?
Yes. Houston's $205.5 million payroll is above the $200.4 million tax line and below the $209.0 million first apron.
Does Fred VanVleet have a player option with the Rockets?
Yes. His $25.0 million salary for 2026-27 is a player option, and Houston has no salary committed to him for 2027-28.
