Answer:
He believed that Texas did not have a chance.
Step-by-step explanation:
At that time, United States military was nowhere near as strong as it is today. Houston believed that all out war with Mexico will resulted in devastating effect for Texas' economy.
On top of that, Mexico was not the only one that's interested in Texas' economy at the time. France and Spain might swooped in and commence an attack to the weakened Texas even if they somehow win the war against Mexico.