Housing affordability has been a major cause of concern for many homebuyers around the country. And although the era of unusually affordable housing has ended, Redfin indicates one Southern market is thriving.
According to the company’s latest analysis, El Paso, Texas, is the nation’s most affordable housing market of the year.
In this metro, 89% of homes for sale are affordable on the national median income, which currently sits around $61,400. This means that about nine out of every 10 homes is available to the housing market’s average homebuyer.
Redfin Agent Maggie Garcia said a lot of people are moving to El Paso because of the affordable quality of life.
“The cost of living has been reasonable for many years and as a result, the rest of the U.S. has noticed our border town more and more,” Garcia said. “El Paso is also home to a busy military base, Fort Bliss, which fuels our local economy by creating many jobs onsite.”
According to Redfin, income growth in El Paso has boosted affordability tremendously.
In fact, the average income in El Paso has grown by 16% from 2014 to 2017. However, income growth has increased by only 9% for the rest of Texas and 12% for the nation overall.
Redfin Chief Economist Daryl Fairweather said growth in incomes almost always translates to growth in home prices.
And she’s right, as El Paso’s median home sale price increased by 7.9% year over year, coming in at $167,950 in May. Notably, this marks the fifth consecutive month of annual price increases.
“As people see their incomes rise, the first change they often make is buying a home or upgrading to a bigger, better one,” Fairweather said. “El Paso’s affordability, combined with its outlook for continued home price growth, makes it a really attractive place for first-time homebuyers looking to increase their wealth through home equity.”
In May, the number of homes for sale in El Paso fell by 8.3% from the same time period last year, indicating homebuyer demand is growing faster than supply. Additionally, the typical home went under contract in 48 days, falling almost twice as fast as May’s 2018 rate of 87 days, according to Redfin.