SHOCKING Market Trends in El Paso Real Estate 2025

SHOCKING Market Trends in El Paso Real Estate 2025

Hey, El Paso. Welcome to your Fall 2025 Real Estate Update. My name is John Peña. If you're looking to buy or sell a home, consider reaching out to us. And let's go ahead and jump right into it. Let's start with the micro. What's happening in real estate in El Paso? I've collected some kind of data points that I think pretty much spill it out pretty clearly. Number one, from Redfin,

median sale price last month for a single family home in El Paso, Texas was $250,000. This is exactly what it was last year at this time. So what that means is that home prices are flat year over year, meaning they haven't lost value and they also though haven't gained value. Typically, we say that in a normal real estate year, your home is going to appreciate 2% to 4%

year over year, which is pretty good. Now, in a crazy market like post-COVID, homes were gaining 15% in one year. That's not happening right now. What's happening now is that it's totally flat. So we didn't get that 2% to 4% depreciation this year. It's flat. All right. So on one hand, it's good news that home prices haven't dropped like they have in other cities.

Austin comes to mind. But at the same time, it's not ideal because we haven't really gained any equity over that year in our properties. Okay. Number two point, inventory, the amount of homes that are actively for sale. Inventory is continuing to creep up. This means that essentially, there are less buyers in the space right now because interest rates are around 6.5% more or less.

Some might say that there's economic uncertainty going on right now. People are a little bit concerned about their job. They're not in a position where they want to make a big move like buy a house. So there are less buyers in the market. And what happens is that the same amount of people typically want to sell their home year over year. And so inventory keeps adding up,

more homes get listed. And so when inventory climbs, that basically means that the market kind of feels really sluggish, especially to sellers, because now a buyer has so much more choice and homes aren't moving as fast, which kind of takes me to the next point, speed of sales. And in other words, how long is it going to take for you if you want to sell your home right now?

The answer to that is about two to six months. If you list your home right now and price it reasonably, you can expect to sell it in within two to six months. Yeah, maybe you'll get lucky and the right buyer comes along right away and you sell it right away. That, of course, happens, but on average, two to six months. If you just cannot imagine yourself waiting that long to sell

your home, one thing you can do, if maybe, is you can sell when the most homes actually sell. That time of year is late spring to early summer. That's when a ton of military members are PCSing to Fort Bliss and they're looking to purchase homes. So little strategy is that if you potentially want to sell your home a little bit quicker, that might be a better time to sell.

Otherwise, right now, and especially going into winter, like, let's be honest, winter is the slowest time of year for real estate. Lots of people, you know, Thanksgiving, Christmas, they're just occupied with other things, right? So there's just a little info on kind of time in the market, how fast are things going? This other thing I find really,

really interesting, and I think it helps sellers also while it helps buyers. Let's talk about the availability of new homes. Right now, the amount of new building permits, new home authorizations has slowed. If you were a home builder, if you owned a home building company, you wouldn't be excited about buying, building homes right now because there isn't that much demand for your

product. So you would want to sit back, maybe hold money and see what happens. Then that's exactly what builders are doing right now. However, according to realtor.com, there's still around 1600 new homes available now or in the next couple of months here in El Paso with a median listing price of $283,000. That's only $33,000 more than the average resale home. Okay? So the other thing

about the new homes is that there's tons of them and builders want to move them. And so they're offering incentives like maybe paying your closing costs, throwing in like the kitchen upgrade, things like that. So for buyers, you really have a lot of choices. Not only do you have a lot of inventory to choose from here in El Paso of resale homes, but there's a ton of new homes that are

affordable that you can consider too. For sellers, unfortunately, that means that you're also competing with those builders who are offering those incentives. So that's not an ideal thing either. This one, I just find kind of interesting. Lot sizes are shrinking. All right. Last year, two-thirds of all new home lots were built under 9,000 square feet. 40% of the new spec homes

occupy lots under 7,000 square feet. So the new construction homes are shiny. They're brand new. They got the incentives. The space that they occupy is getting smaller, shrinking, which means it's going to feel like your neighbors are maybe kind of on top of you a little bit more. So I guess there's a little bit of a trade-off. So that is the micro version of the real estate market

in El Paso right now. In a nutshell, it's pretty slow. It's sluggish. Okay. And we're going into the slow time of year. However, one interesting thing is that if you are a buyer, there are definitely opportunities here for you that there are not going to be in a seller's market. And of course, we know for you homeowners, when you got to sell, you got to sell. And of course, what are

you going to do if you need to sell quicker? You're going to have to incentivize buyers, which typically means lowering that price a little bit and maybe taking a little bit less. So hope that that was helpful. Now, if you're still sticking around, man, you've got some staying power, but I'm going to talk a little bit about some of the macro trends that are going on

in real estate because they're super interesting. Number one, how is the government shutdown affecting home sales? Okay. In a nutshell, the answer is not that much. However, keep in mind that real estate accounts for 20% of the US economy. All right. And it also drives millions of jobs. So the only things that are really being affected now, there's a lapse in the national

flood insurance program. So it can't issue new policies in El Paso here. That's not a problem. FHA loan endorsements are facing potential delays. VA loans, military members not getting paid. So I looked this up. All active duty military members are considered accepted, E-X-C-E-P-T-E-D, accepted employees, meaning they are required to keep working, but their paychecks can be

delayed or missed until Congress passes a funding resolution. PolyMarkets is saying that we're likely to be in this shutdown through mid November. So we have some clients who are purchasing right now and all of a sudden you stop getting your paycheck right before you're supposed to close. That's not ideal. So that's kind of going on behind the scenes. Here's another interesting,

bigger fact for the country. Buyers are canceling contracts at record rates. In August of this year, 56,000 home purchases were canceled. Okay. That's about 15% of all homes that were under contract. The buyer canceled. Why did the buyer cancel? They couldn't agree with the seller on home inspections and repairs, 70%. 28% of the time the buyer financing fell through. So maybe somebody

lost a job or something happened with their finances. And then the third one, 20% of people, the buyer was contingent on selling their existing home, but they couldn't sell their existing home. So that's pretty interesting. And then one last one here. So who's really thriving in this market? It's certainly not homeowners, sellers and the buyers that can get qualified. Yeah, they're

doing pretty well, but the real people that are winning here are investors. Okay. The investor's share of home sales hit a five-year high. In quarter two of this year, investors bought one third of all the single family homes. Okay. Sold. Why? Because investors buy low and sell high. Right now you can get some pretty good deals on homes. Lots of prices are coming down. All right.

Now keep in mind, it's not the big corporate investors that are buying up all these homes. It's actually small investors with 10 or fewer homes that make up over 90% of investor ownership. I thought it was honestly going to be way more skewed to like the big corporate people that are buying up single family homes, but it's the small investors. So these investors paid an average of

$455,000 per home, which is below the $513,000 national average. So there's just some geeky real estate news for you. Thanks so much for checking out the episode. If you're concerned or looking or want to have any questions about buying or selling a home, please consider reaching out to us. We'll see you in the next episode.