Exploring the relation between inequality and subjective well-being is an enduring topic in happiness economics. However, less attention has been paid to clarifying the relation from the perspective of micro-level consumption inequality among households. A household often focuses more on its relative consumption status than overall consumption inequality by comparing its own consumption with that of other households with higher consumption levels in the reference group. This upward comparison results in relative consumption deprivation. Using data from the 2019 China Household Finance Survey, the relation between relative consumption deprivation and household subjective well-being and the moderating role of housing wealth are investigated in this study. The results reveal a negative association between relative consumption deprivation and subjective well-being, with the relative deprivation of subsistence consumption being more closely related to reduced subjective well-being than that of developmental consumption. Moreover, this association exhibits an inverted U-shaped pattern with increasing housing wealth, implying that relative consumption deprivation is more negatively associated with the subjective well-being of households with either relatively low or high levels of housing wealth, while for other households, the inverse association is weaker. The heterogeneity tests indicate that relative consumption deprivation has stronger negative associations with the subjective well-being of households with larger sizes, experiencing economic deterioration, or residing in first-tier and second-tier cities. Further analyses show that when households are facing an upward trend in housing prices, the linkage between relative consumption deprivation and the loss of subjective well-being is stronger in households without dwellings than in those with dwellings.