El Paso - Any experience/info?

[Russell Naylor]

Hey all, 

I have been in the El Paso area for the last couple weeks on business. I am a claims adjuster and have been working on every end of town and surrounding suburbs. Something I've noticed is that there are single family rentals EVERYWHERE. 

There is a military base in town, apartment buildings and housing developments being built all over the place, and it seems that the population is way larger than the city itself is currently able to handle. 

I was just curious if anyone has done any business here and if they had any additional information/insight as to if it is a market to look at. With all the rentals being available (and I've only been here a couple weeks) it can be hard to tell if its a hot market or if the market is just heavily saturated. 

Thanks for the help!

- Russ

[Scott Perry]

Hi Russell,

My second rental property is in El Paso. I'm in the Army and did the live and flip on a home while I was there and it turned out great. The problem is that there are a lot of homes for sale for a much great price then they are actually worth. The way I got a good deal was by sticking to the price per sq ft method. For ex. El Paso (all sides of town except south of I-10 from central to east) the approximate price per sq ft is

High $85

Average $73

Low $58 (this is not including full rehab SFHs where you can find a lot cheaper)

I bought on the north east side of town where most homes are on the market for $85 per sqft. I paid $61 per sqft. I put about $5,000 into it for new carpet, paint, and water heater (labor is less expensive in El Paso) and on a 30 year mortgage with only %5 down I would be cash flowing about $400 per month after all costs. However, I want the house paid off soon so I got a 15 year lone which means I only make a few dollars a month. Being in the Army I have a steady income and can afford the mortgage if there is a vacancy. When I moved the house was on the market for 12 hours and the first of 5 viewers schedule rented it. They have been great so far.

I agree with Kelvin though. Around 2011 (maybe 2012ish) there was an upswing in home values because of military restructuring that is now in full effect (i bought my short sale after this up swing). At that time new military members were on a 6 month waiting list even for dumpy rentals. Since then there hasn't been any movement in the market though. I personally like El Paso for investing and plan on buying another rental there in the future. The main strategy there is buy and hold which is what I like to do. I have a great realtor who is also an investor and a higher than average property management company which makes the buy and hold strategy even easier. If you want my realtors info let me know. He lives on the west side and really has the investment mindset when it comes to looking at properties. He also has started working in multi units. As Kelvin said, there isn't much change in the market like other places but I like the stability. 

A few tips...

There are flood planes that experience flash floods every year!!!! I wouldn't recommend buying there. Some people do and it works but I just don't want the headache. If you do find a property in one of these zones make sure you have good flood insurance. Its not a question of "if" its a question of "when"? And mostly the answer had been every year.

Fix and Flip is a hard strategy due to 2 big fix and flip guys that are well established in the area and they suck up the deals really fast.

The reason El Paso is condensed and hasn't spread out is due to its infrastructure. So far El Paso hasn't been able to successfully push its infrastructure further into the desert. Side bonus for owning a rental property. The "far east side" is the area they are making the most progress in this area.

Haven't been to El Paso in about a year now so the info is a little old but I haven't heard that its changed much. If you have any questions let me know. Hope this helped!

Scott

PS: Anyone know how to do the @ someones name thing to quote them without quoting their whole post?