Ariza will earn $32 million during that period, per The Houston Chronicle's Jonathan Feigen:
"The Rockets went back to work, and kept going back, past their failed efforts to sign Chris Bosh, Carmelo Anthony or LeBron James, past years of rebuilding and all the way back to one of Daryl Morey's first significant free agent signings as Rockets general manager.
"Stunned by Friday's sudden change of direction in their pursuit of Bosh, the Rockets came to an agreement on a four-year, $32 million contract with (Washington) Wizards free agent Trevor Ariza, returning Ariza to Houston five years after they signed him when they lost Metta World Peace, then Ron Artest, in free agency.
"Ariza is coming off his best (of 10) NBA season, and unlike his move from the Lakers to the Rockets in 2009 when he was trying to expand his game on a rebuilding team, he has become even more adept in his role defending small forwards and working off star players.
"He does not, however, replace Bosh, who would have neatly slid in as a perfect fit power forward, in the Rockets' schemes. And he does not answer the most pressing question of whether the Rockets will choose to match the offer sheet Chandler Parsons' signed with the Mavericks.
"With the clock ticking toward the 10:59 p.m. Sunday deadline to match the Mavericks' offer of $46 million over three seasons or lose him to Dallas, the Rockets were still weighing their options, a person familiar with the decision-process said. In keeping with their policy and history, if the Rockets match, it would not be until the deadline.
"The Mavericks were moving on contingency plans, seeming to think the Rockets would match, though on Friday the Rockets had begun work on backup plans in case they did not land Bosh even though at the time they were certain they would.
"Mavericks owner Mark Cuban said he had no feeling about what the Rockets would do and did not feel any increase in confidence that the Mavericks would get Parsons when he heard about the deal for Ariza. But he also said he thought the Rockets will do what he would do. He had already demonstrated what he thought Parsons is worth.
"'It's just a waiting game,' Cuban said. 'You just wait. I know what I would do. I don't expect them to do anything different.'"
Trevor Ariza will sign with Rockets on 4-year contract worth $32 million. (via ESPN & multiple reports) pic.twitter.com/l5JIlDFZjG— SportsCenter (@SportsCenter) July 12, 2014
A day later, Feigen says the Rockets chose not to match their offer for Parsons, who will now play for the Mavericks:
"The Rockets knew they would be better with Chandler Parsons than without. They believed, however, they were not good enough to consider their roster complete.
"Months after Parsons had been among the keys to the Rockets' hopes, their captain and perhaps the league's best bargain, he is none of those things. He is instead the Dallas Mavericks' prized free agent acquisition and the symbol of the Rockets' off-season gone wrong.
"A year to the day after the Rockets officially signed Dwight Howard, they chose not to match the offer sheet signed by the player that helped recruit Howard, letting Parsons jump to the Mavericks and a three-year, $46 million contract.
"The Rockets chose to let Parsons go to Dallas Sunday because they believed that with the contracts held by Parsons, Howard and James Harden they would be essentially locked out of other moves, a person with knowledge of the decision said.
"They instead opted to take the heat in exchange for the flexibility, with several potential deal-making moves, believing their chances of building a contender would be better with the ability to make other moves...
"....With an agreement to bring back Trevor Ariza to play Parsons' small forward position, the Rockets hoped to immediately upgrade their defense while seeking to develop young starters Terrence Jones and Pat Beverley.
"Even with Ariza, however, the loss of Parsons represents a major blow, with the Rockets also dealing Jeremy Lin and finalizing negotiations on the trade of Omer Asik in the name of cap space they had hoped to use on a third-signature star.
"The Rockets were determined to improve defensively and the addition of Ariza should be a significant step in that direction. But that is a long way from the moves they had thought they were about to make.
"Had the Rockets landed Chris Bosh on Friday, they would have matched the offer to keep Parsons, a person with knowledge of the thinking said, becoming a team widely expected to be in position to join the championshp contenders. Instead, they have taken several steps backwards, depending on what moves they put together to rebuild."
The 29-year-old Ariza previously suited up for the New York Knicks, Orlando Magic, Los Angeles Lakers, the then-New Orleans Hornets and Wizards. This is his second stint with the Rockets, whom he played for in 2009-10 NBA season.
He has averaged 9.7 points, 4.6 rebounds and 2.0 assists in 632 career regular-season games, per ESPN stats.