Hot Real Estate Market in El Paso
By Ana Valverde
Texas one of the hottest residential market states in the country and El Paso is helping by being among the top 12 cities in the state with more real estate activity according to The Texas Real Estate Center at Texas A&M University.
Blanca Flores, a house wife who has benefited from the appreciation rate of homes in El Paso, said, “I never thought my house was going to significantly increase in value like it has since we bought it five years ago.” Flores purchased her home in the north-east side of town for $70,000 and is now worth $99,000. Buyers like Flores are glad to know El Paso is not a bubble market, where home values rise like a balloon and when it reaches the brim it pops sweeping all the value accumulated over a period of time. For this reason homes values continue to rise like a bubble and it will not burst because home sales are doing well and cannot depreciate. According to president of the El Paso Association of Realtor, Patty Chagra, “El Paso is not in a bubble market.”
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Within the last few years, El Paso has demonstrated a strong appreciation in home values approximately six or seven percent each year, and all factors indicate this will continue. There are currently approximately 2,500 listings on the market and homes are selling at about 98 percent of the list price, according to the Multiple Listing Service sponsored by the Greater El Paso Association of Realtors. Chagra said that “El Paso just isn’t like other markets, El Paso is a very affordable market and a buyer can get a lot of house for a lot less money.” Texas Real Estate Center at Texas A&M University reported that the median house price for El Paso is $127,000 while the country’s median house price for 2006 is $227,533.
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According to Fortune Magazine, Texas cities are the country’s hottest residential markets with significant home price appreciation rates in 2006. The Magazine ranked San Antonio number one in the nation with an appreciation rate of 8.3 percent for 2006, El Paso followed closely with an appreciation rate of 8.1 percent.
Ray Martinez, a broker and owner of Source Real Estate, said, “We are experiencing a dramatic climb in prices and I believe it can be as dramatic as a 20 percent increase over the last three years. El Paso is finally seeing and enjoying a rate of appreciation which is unprecedented.”
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Despite the appreciation of El Paso homes residential real estate is 26 percent undervalued, according to a story published by CNNMoney.com. A study by the Killeen Daily Herald of 100 housing markets stated that El Paso’s present actual median home value is $127,500, while equal value homes in Galveston are $171,500.
This is one reason for investors like George Patterson, a military retired veteran to move and invest in El Paso. “The market has improved a great deal…finance is now very easy…the market has gone wild it’s beautiful,” Patterson said. In a survey conducted by The Housing Market Analysis and National City Corp with Global Insight, agreed that El Paso is the second most undervalued market in the nation. Patterson agreed that El Paso is a good place to invest. “El Paso is in a boom for a while… and I’m here to make some money,” he said.
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Flores agrees that unlike California El Paso is one of the most inexpensive places she has found to buy her home. “It gave us the perfect opportunity to buy our dream home… I now live in a three bedroom home with a good size yard and garage like we always wanted,” she said. El Pasois appreciating at a higher rate of six percent than the entire state of Texas last year, according to the Home Price Appreciation El Paso MSA provided by the Office of Federal Housing Enterprise Oversight. “Now you buy a house and its worth more the next day. This is why investors prefer to come to El Paso,” Martinez said.
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As a result, El Paso is the city with the highest increase in home sales of Texas border cities, on a 30 percent increase over the previous year, The Texas Real Estate Center at TexasA&M University has reported. The increase has led to more new homes being built. A city of around 721,598 residents, according to the U.S. Census Bureau, more than 75,000 people reside on the Eastside of El Paso, causing it to stretch east and north of Horizon City to Joe Battle Boulevard on the west. More military troops are arriving to El Paso causing this expansion and requiring builders to build at a faster rate to meet the increasing housing needs. “El Paso is poised to experience tremendous growth due to factors that include BRAC (Base Realignment And Closure that allows for realignment of military bases or even closing of such, and allows military families to come to El Paso), which is bringing thousands of families into El Paso and the surrounding areas,” Martinez said. |
At the same time this growth has caused Hunt's Paseo del Este to develop a residential home project of about 5,600 acres east and north of Horizon City, which will take approximately a decade or more to complete. "It will take several months to get through the process, because there are so many things involved in coming up with that master plan," K. Douglas Wright, president Hunt Communities, said. "But when all the smoke clears, we'll end up with a plan that is well balanced, with retail, commercial and residential components as well as plenty of open space and parks."
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Wright refused to say how much the entire project would cost, but indicated it would easily be more than $100 million.
Real estate agents like Martinez will continue to see their business grow for the years to come. An El Paso agent for more than 16 years, Martinez said he has been tired and overwhelmed because of all the home sale activity. During a recent interview, Martinezwas interrupted by non-stop phone ringing. “The future is quite optimistic for the El Paso housing market,” he said. It seems El Paso will continue to be among the top 12 cities in the state with more real estate activity and yet the most inexpensive for buyers.
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*images provided by google
