Flipping homes in El Paso is less glamorous than it looks on popular HGTV shows like “Property Brothers” and “Flip or Flop,” but it can pay.
“You won’t become a millionaire,” said Yadira Orta, a real estate agent in El Paso. “It’s not the profit you see on TV shows, but it is a profit.”
El Paso Inc. spoke to Orta and others about what it takes to flip houses – the practice of buying a house, updating it and then “flipping” it to a new buyer. Many of the flipped properties can be found in older, more established areas of El Paso – away from the fast-growing fringes of the city.
El Paso is the best place in the country to flip a house, according to the personal finance website WalletHub.com. El Paso gets high marks for market potential and low renovation and remodeling costs.
Nationally, house flipping is on the rise. More than 6 percent of home sales last year were “flips,” according to a report published by Trulia. That’s the highest number since the real estate bubble burst.
Housing experts in El Paso say the low cost of buying and refurbishing El Paso homes and the stability of the market make flipping homes here attractive, although there are risks involved.
The median price of El Paso homes hovers around $150,000, which is much less expensive than the national average. Nationally, the median price is $263,800, according to the National Association of Realtors.
Heather Harmston, a real estate agent in El Paso, said when she selects a house to buy and flip, she considers the neighborhood she is buying in. She has bought properties in the Cielo Vista area on the Eastside and Central El Paso’s Five Points neighborhood.
She said she likes to invest in those neighborhoods because they are established and closer to retail and entertainment as well as parks.
How much Harmston invests to flip a home varies significantly and depends on what price she thinks she can get for the remodeled home. With a background in interior design and architecture, Harmston said she focuses her investment on the home redesign.
She said she has invested as much as $30,000 – or even $90,000 – into remodeling houses.
“Although I am investing that money, I have a hard-money lender,” Harmston said. “It’s not initial cash up front we are putting up in order to do this.”
Right now, Harmston is involved in a $90,000 renovation project where a house burned down at the intersection of Montwood and McRae.
“It’s like building new construction,” she said. “Not everyone can do that.”
According to Trulia, the city of El Paso led the trend in flipped-home sales in 2011 and again in 2014. Almost 13 percent of home sales in 2011 were flips, and more than 10 percent were flips in 2014.
However, El Paso did not make Trulia’s most recent list of flipping hot spots. In fact, the city landed at the 67th spot for 2016.
Dan Olivas, president of the Greater El Paso Association of Realtors, said the relatively low value of houses in El Paso plays a big part in how El Paso rates among other cities.
Olivas, who has worked as a real estate agent in El Paso for decades, said he has not seen large rates of return on flips, and he has not seen a real estate business survive on income from flipping houses alone. Even so, he said real estate agents involved in flipping houses sometimes turn a profit.
“I know they do take place,” he said. “The rate of return is not skyrocketing.”
El Paso’s reputation for being a good market for flipping houses has attracted companies that advertise workshops. The workshops are free but turn into pitches to entice participants to pay for another workshop.
After the second workshop, another pitch is made to enroll participants in what are often pricey mastery courses. That’s how real estate agent Yadira Orta got started flipping houses.
“It was a lot of money,” she said.
Orta has been in the real estate business for 13 years and has flipped houses for the past three years. She says she has sold 21 houses with her business, has three houses under renovation and three on the market.
The first house Orta says she worked on cost $172,000 to buy, and it sold for $460,000. She says she invested $80,000 into the house and turned a profit of about $42,000.
Like Harmston, Orta likes the Eastside and the historic neighborhoods in Central El Paso. But she also invests in houses on the Westside.
“You make money when you buy, not when you sell” she said. “If you buy right, then you can sell it right.”
Email El Paso Inc. reporter Aaron Montes at email@example.com or call (915) 534-4422, ext. 105. Twitter: @aaronmontes91