The home market in El Paso is normalizing after a wild, sometimes crazy ride in recent years, real estate industry officials say.
The market in El Paso is now “more of a normal market where a home sells for the average resale price in about 60 days and the average buyer pays interest of 6.75 to 7.25 percent,” said Patrick Tuttle, broker and owner of Coldwell Banker Heritage Real Estate and a real estate agent in El Paso for 23 years, in a recent interview.
But real estate prices remain high.
Normalization is leading homebuilders and, in some cases, resale home sellers to once again offer incentives to buyers as El Paso becomes more of a buyer’s market.
“Our market is (now) driven more by life changes than interest rates,” Tuttle said. But interest rates fluctuate around 7% kept many people away from the market for over a year, he added.
Problems on the stock market cause mortgage interest rates to rise
Danny Nassar, branch manager of Canopy Mortgage in El Paso, Utah, was encouraged in recent days as mortgage rates fell in response to the huge stock market crash on Aug. 5. That could open the doors to loans for more buyers, he said. The stock market quickly recovered, however.
The national average mortgage rate fell to 6.47% in the first week of August, the lowest level since March 2023, mortgage lender Freddie Mac reported Aug. 8.
Some companies, including Canopy, can respond quickly to changes in financial markets and offer interest rates well below the national average, Nassar said. A buyer with good credit can get a mortgage at Canopy for around 6.25 percent, and in some cases as low as 5.25 percent, Nassar said Aug. 7.
Home sales almost unchanged in 2024
There were 4,732 home sales in El Paso County through the first seven months of 2024, virtually unchanged from the same period in 2023, data from the Greater El Paso Association of Realtors shows. That’s 19 fewer home sales than the January-July 2023 period.
The data includes both resales and new construction, but not all new home sales are reported to the El Paso Realtors’ Multiple Listing Service.
Median home price in July: $265,000
Real estate prices are showing signs of stabilization, Tuttle said.
The highest median price this year was $265,950 in May, according to data from El Paso Realtors. In July, the median price was $265,000.
Shy Rodriguez, President of El Paso Realtors Associationsaid real estate prices in El Paso remain cheaper than in many cities across the country.
According to data from the National Association of Realtors, El Paso was the 54th lowest-priced market among 223 metropolitan areas in the United States in the second quarter of 2024.
“We have a good, stable market,” which is partly helped by buyers coming here from more expensive areas, Rodriguez said.
However, El Paso saw the third-highest percentage increase in median home price nationwide in the second quarter, according to data from national real estate agents. The median price for a single-family home in El Paso was $264,400 in the second quarter, $42,600 more than the same quarter in 2023, an increase of 19.2%.
In July 2019, before the pandemic, the median home price in El Paso was $165,000, according to El Paso Realtors data. That means the average price has shot up $100,000 in five years, a 61% increase.
In El Paso’s more normal market years before the pandemic, home prices generally rose 1 to 2 percent per year, Tuttle noted.
El Paso is turning into a buyer’s market
“Overall, it’s a buyer’s market, but in certain price ranges, it’s a seller’s market,” Tuttle said. Homes under $300,000 sell faster, and homes under $200,000 that are hard to find typically get multiple offers, he said.
High mortgage rates and sharply increased home prices have made this a buyer’s market for new homes, said Victor Mendoza, president of Desert View Homes, a division of El Paso-based View Homes.
The company and other homebuilders are offering buyers lower interest rates to make homes more affordable and give more people the opportunity to buy a home, Mendoza said. Desert View is cutting mortgage rates as low as 4.75%, he said recently.
This helped Desert View increase the number of homes under contract in the first half of this year. However, the number of completed sales declined slightly in the first six months of the year.
The average home price in Desert View is $303,000, and anything under that usually sells quickly, Mendoza said.
New homes are at market lows of $201,900
Desert View is selling some of the area’s most affordable new homes in its Rancho Desierto Bello development in Horizon City in far eastern El Paso County, with prices ranging from $201,900 to $225,900.
Desert View can build these lower-priced, first-time buyer-oriented homes in Horizon City for several reasons, Mendoza said: Land prices are lower there, Desert View is developing the community and the homes are much smaller than the more expensive models.
The homes in Horizon City are already sold before they are even built, Mendoza said.
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The new normal is higher
Jaime Gonzalez, president of the El Paso Association of Builders, the umbrella organization for home builders in El Paso, said high land prices and high construction costs make it difficult to build homes at prices that would be more affordable for that market.
“It’s a stable market. The demand is there, the supply is there. The problem is affordability,” said Gonzalez, owner of Blue Sage Homes. “Anything between $250,000 and $400,000 is in demand, but it’s hard for buyers to afford it.”
“From where we were during the peak of COVID, things have calmed down, they have normalized a little bit, but the new normal is higher than the old normal.”
Selling houses in El Paso takes longer
Dennis Louviere, who had his East El Paso home listed for sale since March, was surprised it took so long to finally get an offer, which he and his wife accepted on August 9. He is selling the house, which he bought in 2017, because his family is moving to his hometown in Louisiana.
Real estate agent Adriana Zehner, who relisted the home for sale on July 25 after it failed to sell through another agent, said one of the reasons the home was on the market for several months was likely because the original asking price of $290,000 was too high. She then listed it for $280,000.
After negotiations, the Louvieres agreed to sell their home for $270,000, but the sale is pending completion, Louviere said.
The days of multiple offers and quick sales at list price or above for a home like the Louvieres’, as was the case during the pandemic, are long gone, said Zehner, associate broker at Coldwell Banker Heritage Real Estate.
Zehner observes that some sellers are making concessions, such as helping buyers sell their homes. Buyer concessions were common when the El Paso market was normalizing before the pandemic, she said.
Vic Kolenc can be reached at 915-546-6421; [email protected]; @vickolenc on Twitternow known as X.
