Buying a home in El Paso is becoming more difficult, even as the local housing market remains more stable than those in other major Texas cities.
Higher mortgage rates, limited housing inventory and wages that have struggled to keep pace with home prices are creating obstacles for first-time buyers. Meanwhile, homeowners with low-interest mortgages are reluctant to sell, leaving fewer properties available.
Alex Huereca, a Realtor and 2026 president of the Greater El Paso Association of Realtors, said El Paso’s stable housing market has helped existing homeowners build wealth.
“El Paso has always been very steady,” Huereca said. “We see other big cities going with these huge spikes when prices go super high, but then they drop a lot when the market gets tough.”
Data from the El Paso Realtors association shows the median sales price of a single-family home increased from $145,000 in 2016 to $268,950 in 2025, an 85.5% increase over nine years.
With the median reaching $280,000 in the third quarter of 2026, home prices are now about 93% higher than in 2016.
While that appreciation has helped existing homeowners build equity, it has also raised the financial barriers for first-time buyers.
A market caught between buyers and sellers
El Paso’s median home price remains below the statewide median of $333,628, according to the Texas Realtors report.
Zifeng Feng, an assistant professor in UTEP’s Department of Economics and Finance, said El Paso’s more modest price increases during the pandemic helped protect the market from the sharper declines experienced elsewhere.
“The housing price increase in El Paso is actually not that high compared to other places,” he said.
Zifeng Feng
Photo provided by UTEP
Feng said mortgage rates are influenced more directly by yields on 10-year U.S. Treasury securities than by the Federal Reserve’s benchmark interest rate. Although Fed rate changes can influence borrowing costs, mortgage rates do not automatically rise or fall by the same amount.
“Most people think the interest rate the Fed raised affects your mortgage immediately,” he said.
Higher mortgage rates make monthly payments more expensive for prospective buyers and can discourage existing homeowners from selling because they would have to finance their next home at a higher rate.
“People are reluctant to do it unless you have to,” Feng said.
For a buyer purchasing a $300,000 home with a 30-year mortgage, Feng estimated that higher rates could increase monthly payments by $80 to $100 compared with a year earlier.
Tom Fullerton, an economist at the University of Texas at El Paso, said the reluctance to sell is contributing to declining housing inventory.
“A separate problem that has resulted in higher prices is higher mortgage rates that are convincing many potential sellers to keep their homes off the market,” Fullerton said.
According to the Texas A&M Real Estate Research Center, El Paso had 2,498 active single-family home listings in September, compared with 3,008 a year earlier, a decline of almost 17%.
Michael Bray, an El Paso real estate professional with about 40 years of experience, said the shortage continues to favor sellers.
The Texas Realtors report showed El Paso had about 3.4 months of housing inventory in the third quarter, down from 4.2 months during the same period last year.
“When there is a shortage of homes, 3.4 months, then that’s better for the sellers,” Bray said.
A balanced housing market has about six months of inventory, he said.
Huereca offered a different assessment, saying market conditions depend on a property’s price, location and condition.
“Right now, we’re kind of on a transition or level market,” Huereca said. “It’s not a seller’s market. It’s not a buyer’s market.”
He cited a recent $230,000 listing that received four offers within 10 days and went under contract for $235,000. Another property priced at $480,000 had remained on the market for four months.
“Anything under $250,000, most of them are selling right away,” he said.
Affordability
For younger buyers, the challenge extends beyond mortgage rates.
Fullerton said housing prices have increased faster than median household income in recent years.
“What is fairly clear is that median housing prices have grown more quickly than median household income in the El Paso metropolitan economy in recent years,” Fullerton said.
Although the housing price-to-income ratio has stabilized since 2024, it remains above levels recorded before the housing affordability crisis.
Feng said El Paso’s low wages make saving for a down payment difficult, especially for younger workers.
“The low income is an issue,” he said.
Housing costs also vary across the region. Feng said homes on the Westside and in the Upper Valley typically cost more than $400,000, while buyers may find properties around $250,000 in Horizon City and below $200,000 in parts of the Lower Valley.
But lower prices can involve trade-offs.
Bray said buyers moving farther from established neighborhoods must consider transportation costs, commuting times and access to services.
“The cheapest house is not necessarily the cheapest housing choice,” Bray said.
He also said El Paso needs more housing options for smaller households, including one- and two-bedroom homes.
Huereca said first-time buyers have limited options when shopping for newly constructed properties.
“At least I haven’t seen any new home on the $200,000 and below,” Huereca said.
New homes generally start above $225,000, Huereca said, although builders are offering incentives, including closing-cost assistance and mortgage rate buydowns.
Huereca also said personal debt is affecting buyers’ ability to qualify for financing.
“I don’t think it is so much the affordability issue; it’s the debt that people are incurring on credit cards and car payments,” he said.
Fullerton said local builders have reported that federal immigration enforcement policies have worsened construction labor shortages, while tariffs have increased prices for materials, including lumber, steel and aluminum.
“Anecdotally, builders in El Paso have indicated that recent federal policies have exacerbated the affordability problem during 2025 and 2026,” Fullerton said.
Where homes are being bought?
Huereca identified Far East El Paso, Northeast El Paso and Horizon City as some of the region’s most active housing markets. He said proximity to Fort Bliss makes Far East and Northeast neighborhoods attractive to military families.
Huereca said first-time buyers are older than in previous years, although people in their 20s continue entering the market.
“Most of them are going to be over 30, more or less,” he said.
What’s next?
Bray said down payment assistance could help buyers who earn enough to afford mortgage payments but lack sufficient savings.
“That’s the help that a lot of buyers need,” Bray said.
He pointed to the El Paso Housing Finance Corp.’s Mi Casa program, which provides assistance with down payments and closing costs.
Another round of financing totaling about $28 million is being prepared, with assistance expected to become available soon.
Huereca encouraged prospective buyers to reduce debt and improve their credit scores before applying for mortgages.
“My recommendation is to pay off your debt and increase your credit so you can get the best interest rate and you can qualify for a house,” Huereca said.
Feng expects El Paso home prices to remain flat over the next six months to a year.
“You cannot expect the price to drop in the coming years,” he said.