Buying a house in El Paso

If you’re considering purchasing a house in El Paso this year, there’s both good news and bad news. Let’s start with the positive: You’ll have a wider array of options to explore. In May 2023, inventory in the city increased by over 17 percent compared to the previous year, according to the Greater El Paso Association of Realtors (GEPAR), with more than 1,000 new listings entering the market. However, on the flip side, you should be prepared to pay more than last year. El Paso’s median sale price surged by 7.5 percent compared to May 2022.

Deciding Where to Live in El Paso

Regardless of where you choose to reside in this border town, you’ll find an impressive level of affordability. The cost of living here is lower than in major Texas cities like Dallas and Austin, and even more budget-friendly compared to other Southwestern cities like Albuquerque.

For those mindful of budget, it’s worth noting that some areas are more affordable than others. While the median home price in the metro area stands at $255,950, prices can vary significantly across different parts of the city. For instance, in central El Paso, the median price in May was just $180,000, whereas in the Upper Valley, it was notably higher at $349,525. Even the Upper Valley median, however, remains below the nationwide median home price of $388,800.

How to Buy a House in El Paso

Saving for a Down Payment

The amount you need to save for a down payment in El Paso depends on the house’s price and the type of mortgage you choose. A larger down payment upfront means lower monthly mortgage payments later. With a conventional loan, you might put down just 3 percent, which on a median-priced El Paso home of $255,950 amounts to $7,678. However, to avoid private mortgage insurance, a 20 percent down payment is recommended, equating to $51,190.

For FHA loans, a down payment of at least 3.5 percent is required, or 10 percent if your credit score is below 580. If you qualify for a VA or USDA loan, you may not need a down payment at all.

Get Preapproved and Find the Right Mortgage Lender

Getting preapproved for a mortgage is a crucial step. It doesn’t guarantee final approval, but it indicates a strong likelihood of securing the specified loan amount. In a competitive market like El Paso, this can be a significant advantage. You’ll need to provide various financial documents, including pay stubs, tax returns, and bank account information.

While you’re not obligated to choose the lender that issues your preapproval, it’s wise to compare offers from different lenders for competitive rates, low fees, and a closing timeline that suits your needs. There are also numerous online lenders that may be suitable for your requirements.

Find the Best Local Real Estate Agent in El Paso

Though not obligatory, working with a knowledgeable local real estate agent can make a substantial difference in a challenging market like El Paso. Homes are selling quickly here, with an average time on market of around two weeks. Realtors are adept at negotiating with sellers, competing with other buyers, and identifying good deals, making their expertise invaluable in the process.