As homebuilders across the country grapple with rising construction costs, labor shortages and persistent affordability concerns, Lydia Mlouhi says El Paso’s housing market remains surprisingly resilient.
The president of the El Paso Association of Builders and co-founder of Crown Heritage Homes is working with her peers to steer the local industry through a period of economic uncertainty while advocating for policies that support growth and homeownership.
Mlouhi, only the third woman to lead the association in its 80-year history, says the home-building industry is balancing strong demand for housing against mounting pressures that continue to challenge builders nationwide.
“I ultimately accepted this position because I wanted to serve as an example for other female builder members – to show that this is a job that can be performed by a woman and that it is absolutely attainable,” says Mlouhi, 59. “The work being done by builders and builder associations benefits not only the construction industry, but ultimately the consumer and the community as a whole.”
Mlouhi, who has more than 20 years of home construction experience, owns Crown Heritage Homes with her husband, Sam. She is the association’s first female president since Kelly Sorenson in 2009.
The nonprofit represents and supports 230 builders and associate members –banks, mortgage companies, third-party inspection companies, title companies and subcontractors.
Mlouhi’s responsibilities include government advocacy, liaison duties, growing membership and communicating with the media.
In an interview with El Paso Inc. at Crown Heritage Homes’ Westside offices, she shared her knowledge of the industry, explaining how homebuilders are adapting to mounting issues of affordability, rising construction costs and a labor shortage – international issues that extend to the Sun City.
Despite the challenges, Mlouhi calmly says El Paso’s market remains healthy as the demand to buy or build a home is stable.
In her conversation with El Paso Inc., she also touched on how homebuyer demographics influence the industry and where new homes are being built.
Q: What drew you to the homebuilder industry? Who influenced you?
I was pretty much raised in the construction industry. My grandfather and father, Manuel Lugo, were in the construction industry. My father was in construction for pretty much all his working life.
Eventually, he became a business owner in the industry. Growing up, I worked in my father’s office during the summers, starting when I was in middle school and continuing through college.
My father supported homebuilders as a plumbing subcontractor specializing in new-home construction. His company was Brasco Plumbing.
It’s kind of funny when I think back. While I was going through school and working with my father, I vowed that once I obtained my degree, I was going to move on to bigger and better things and never look back.
But in 2001, I did exactly what I said I would never do. Along with my father and my husband, Sam Mlouhi, we founded Crown Heritage Homes.
To my surprise, I found my calling in this industry. I fell in love with the challenge of designing and building custom homes from a blank canvas of dirt.
Several years later, my father sold his share of the business to Sam and me. We eventually joined the El Paso Association of Builders. Sometime later, I became a board member of the EPAB.
Lydia Mlouhi
Ruben R. Ramirez
Q: What are the goals of the association and your goals as president?
The goal of the National Association of Home Builders, the Texas Association of Builders and the El Paso Association of Builders is always to advance and promote housing and homebuilding. That remains our primary goal.
This year has actually been very challenging because our executive officer, Ray Adauto, who runs the day-to-day operations of the association, has been out due to health issues.
The good news is he’s recovering and doing well, but we don’t know when he’ll be able to return to work.
Our immediate goal is to continue operating the association as seamlessly as possible while Ray is away. He’s been our executive officer for many years.
At the same time, we had clear goals regarding membership growth. I think a lot of people don’t realize that the Association of Builders is not only open to builders but also to associate members.
Any business whose work supports homebuilding, and really any business interested in joining, is welcome.
We recently held a membership event that was very successful. We invited prospective members to learn about the benefits of the association and gave them an opportunity to join during the event. It’s something we haven’t done in years, and after seeing the response, we’ve decided to make it an annual event.
We also sponsor a Parade of Homes, where we showcase new homes featuring the latest design trends and building methods. We don’t hold it every year, but this year we will host a Parade of Homes in October in the Cimarron Canyon subdivision on the Westside.
That’s another major project we’re working on.
This year also marks our 80th anniversary, which is a tremendous milestone for the association. We’re planning an anniversary celebration, whether later this year or sometime next year, before we turn 81.
Q: What are some of the challenges homebuilders face today?
A shortage of affordable housing is the single largest issue facing the homebuilding industry, both nationally and locally in El Paso.
According to the latest National Association of Home Builders Wells Fargo Cost of Housing Index, a family earning the national median income of about $106,800 must spend roughly 30% to 32% of its income to purchase a median-priced home.
For lower-income families earning only 50% of the median income, that percentage increases to approximately 65% of household income.
That’s a considerable portion of a family’s income going toward housing and represents a severe housing-cost burden.
The NAHB also reports that the country continues to face an estimated housing shortage of about 1.2 million homes, which continues to place pressure on affordability nationwide.
On the other side of the equation, builders continue to face rising construction costs, labor shortages and regulatory burdens that increase the final cost of housing.
Recent federal housing data shows that single-family housing starts declined 2.4% in April compared with April 2025, reflecting the affordability challenges, elevated mortgage rates, higher construction costs, labor shortages and financing expenses builders are facing nationwide.
Although we have a housing shortage, many people who need homes simply cannot afford them. That creates a challenge for homebuilders because even though the demand exists, affordability becomes the limiting factor.
Q: Does that influence what type of home is being built?
Absolutely, depending on the homebuilding company. We all have different demographics and different target markets, but we are constantly adjusting.
For the market that we serve, which is buyers of custom homes, we’re finding that after the pandemic a lot of people are working remotely. So, we’re seeing more demand for home offices than before.
Some of our buyers are requesting two home offices, one for each spouse.
Q: What type of home are El Paso builders constructing the most?
The demand for larger homes has definitely changed.
Way before the pandemic, the custom home was closer to 4,000-square-feet and above.
Nowadays, we’re seeing that buyers, especially if they want luxury-type upgrades, are OK with a smaller home. They’re definitely looking for energy-efficient homes.
Q: In terms of demographics, who is buying homes in El Paso?
Depending on the type of home being purchased, the demographics vary.
The median listing price of a home in El Paso is $298,900. First-time homebuyers purchasing homes below that price point tend to be younger families.
Today, many are closer to age 40, perhaps 38 or 39.
For move-up buyers – the customers many custom homebuilders serve – we’re seeing buyers ranging from their mid-40s to empty nesters who may be downsizing or purchasing another home after raising their children.
Q: Where are El Paso homebuilders working more frequently?
The city is definitely expanding more east. One of the challenges that El Paso’s homebuilders have is lot availability on the Westside. They’re few and far between.
There are a few more lots available in the Upper Valley in different price ranges, although lately they’ve been more at the higher end of cost.
The Westside always has more demand than there is inventory, and every lot allocation we’re seeing continues to increase in price.
Most of the growth is actually in El Paso County in areas like Horizon City, not so much in the city of El Paso.
The city of El Paso itself is not experiencing a lot of growth because it’s pretty much built out.
One possible solution would be any land that is owned by the government or other owners, if they don’t have a need for it, could be made available to developers.
We made a conscious effort and worked along with our politicians to potentially refine the building requirements for some lots, which would obviously not comply with what the newer subdivisions are able to do.
Q: What other trends are there in the El Paso home market?
El Paso continues to benefit from a relatively stable housing demand compared to many other regions of the country.
Our community continues to benefit from military activity, healthcare growth, manufacturing logistics and a strong family-oriented culture that supports long-term home ownership demand.
Builders in both the entry-level and move-up home markets are reporting an increase in home sales to out-of-town buyers. Some of these buyers include people who were originally from El Paso and are moving back to our city.
El Paso also remains comparatively affordable relative to many larger Texas metro areas, which continues to make our market attractive for both buyers and builders.
However, buyers today are taking more time making purchasing decisions. They are carefully evaluating monthly payments, interest rates, utility costs, taxes, insurance costs and overall value.
We’re hoping that as long as the economy remains somewhat healthy, the trend will continue in El Paso.
Q: How are mortgage rates impacting the industry?
One of the challenges affecting builders and buyers today continues to be elevated mortgage rates. Higher interest rates directly impact monthly payments and reduce purchasing power for families.
Builders are also affected by higher borrowing costs associated with land acquisitions and development financing. Builders continue to face rising costs associated with materials, fuel, transportation, labor, utilities and development.
Construction material costs, exacerbated by tariffs, are up 46% since February of 2020. That’s a substantial increase, which is significantly higher than the overall inflation rate of 24%. Our costs are outpacing even inflation rates.
Higher diesel and gas prices are additional factors increasing construction costs nationally as of this year. It’s very important for all of us to understand that every increase in construction costs to a builder ultimately impacts housing affordability.
Q: Have any subcontractors or businesses been at risk of shutting down from this?
Lydia Mlouhi
Ruben R. Ramirez
We’ve adapted. A lot of homebuilders, rather than passing on some of these increases to our homebuyers, have absorbed a lot of these additional costs. Ultimately, it affects our bottom line, but that is how homebuilders have been able to continue to keep their doors open.
Obviously, if this trend continues, or if it escalates, it’s just going to be more of a challenge.
It’s not only on the side of the builders. Our subcontractors and our vendors have really been helpful in terms of absorbing some of those price increases.
Q: How are labor shortages impacting the industry?
The homebuilding industry is experiencing one of the highest labor shortage challenges compared to many other industries.
Weak job growth, low workforce participation and a significant slowdown in population growth are continuing to place pressure on the labor market overall. There were nearly 225,000 job openings in the construction industry nationwide in March 2026.
The labor shortage also extends to planners, building inspectors, engineers, specialized legal professionals, technical staff and many other positions that support the residential construction and development process.
In 2024 alone, labor shortages prevented about 19,000 homes from being built nationally.
Construction timelines for many small and mid-sized builders extended by nearly two months on average. These timelines translate directly into additional construction costs, something that most of us would not even realize.
Q: Does anything involving ICE or the border security here in El Paso impact the labor shortage?
I’m sure that not only our industry but also other industries like restaurants are impacted by this. Especially in areas like El Paso, where we’re a border town.
Q: Are there workers scared to go out for the job because of immigration raids?
I have heard of that more so in the news. I don’t really have any firsthand information on that. But it could definitely be a factor.
Q: What else impacts the labor shortage?
If you look at the average age of a construction worker, it’s getting up there.
High school graduates are encouraged to go to university and obtain a four-year degree. Even at the high school level, counselors might not be trained to suggest technical or vocational schools to students.
The builders associations, on a national and local level, are trying to communicate the benefits of a job in the construction industry. It can be very gratifying.
They’re well-paid jobs that require a high skill set. A lot of it is just the messaging of giving our young people that option and showing the benefits of the construction industry.
When we started in the industry, I would see more subcontractors who had their kids working with them. They would teach them the trade. That’s what my grandfather did with my father.
Q: Any other challenges worth highlighting?
Permitting and regulatory challenges. Builders across the country continue to face increasing regulatory costs, permitting timelines, infrastructure coordination issues and development-related delays.
Regulatory costs now make up about one-quarter of the cost of a new single-family home, and even a larger percentage of multifamily housing costs.
Because of delays in zoning challenges and development-related requirements, these burdens make it especially difficult to build attainable entry-level homes for first-time buyers.
While regulations and building standards are of course important, delays and inefficiencies can significantly increase costs and slow housing production.
Q: Anything you’d like to add that I may have missed?
While the home building industry continues to face challenges relating to affordability, labor shortages, construction costs, financing and regulatory pressures, I remain optimistic about the future of housing.
In El Paso, our industry has consistently demonstrated resilience, innovation and a strong commitment to meeting the housing needs of our communities.
I believe that through collaboration between builders, industry partners, local government, educators and community leaders, we will continue working towards solutions that improve affordability, expand housing opportunities and help more families achieve the dream of home ownership for generations to come.