Jim Smith had taken Oxford United to the top tier of English football. When he left in 1985, his replacement, Maurice Evans, looked to Houghton to help solidify their place in the league. He paid £147,000 for Houghton on 13 September 1985. Houghton had played 145 times for Fulham and scored 21 goals. He made his U's debut the day after he signed, in a 2–2 draw with Liverpool at the Manor Ground. By the end of his first season, Houghton had helped to steer Oxford clear of the relegation places, just staying up with a win on the final day of the season, but most notably scored the second goal in the club's 3–0 League Cup final victory over Smith's new team Queens Park Rangers at Wembley.