El Paso County

El Paso County sits at a median home price of $233,084 against a median rent of $1,521, producing a rent-to-price ratio of 0.0783, or roughly 0.65% monthly. That number places it firmly in the middle of the cash-flow-to-appreciation spectrum: not a pure yield play, but meaningfully better than many Texas metros where ratios have compressed into the 0.4% range. The modeled 5.09% cap rate confirms this positioning. At 6.85% financing, though, the spread between cap rate and cost of debt is negative, which is why the model's cash-on-cash return lands at -5.22% on a 20% down payment. The $-233 monthly cash flow is the result of a $1,222 mortgage plus $532 in estimated operating expenses running past $1,521 in rent. Home price appreciation ran 2.48% year-over-year, modest but positive, and the affordability index of 80 indicates prices remain accessible relative to local incomes, which matters both for owner-occupant competition and for keeping renter demand intact.

For a pure cash-flow buyer expecting to collect yield on day one with conventional financing at current rates, El Paso is a difficult story. The numbers require either a below-list acquisition, a larger down payment to reduce the mortgage drag, or a seller concession to buy down the rate. The cash-flow score of 78 reflects the market's potential relative to other counties nationally, but that score assumes normalized conditions, not today's rate environment. The more realistic buyer here is someone who can underwrite the modest negative carry while targeting the 2.48% annual appreciation and the 80 affordability index as a signal that the market has not already priced in speculative premiums. A value-add operator can make the numbers work faster: if rent can be pushed meaningfully above the $1,521 median on a below-median-priced acquisition, the cap rate math improves without waiting on appreciation. The county's overall score of 71 and 82nd national percentile ranking out of 1,000 counties suggest it is a credible hold, not a trade.

El Paso's economic profile is shaped by a combination of federal military and government employment, its position as one of the largest US-Mexico border crossings, and the University of Texas at El Paso. Fort Bliss, one of the largest US Army installations by area, is the dominant institutional anchor, providing a base of stable, recession-resistant rental demand from active-duty personnel, civilian contractors, and rotating military families who rent rather than buy by necessity. Border trade and logistics activity support additional employment layers. The university contributes a student and faculty renter pool. Together these anchors mean the renter base is more insulated from private-sector cyclicality than a comparably sized market without federal presence, which helps explain the 50 stability score, a figure that is not alarming in absolute terms but warrants monitoring given that federal workforce and defense budget shifts can ripple through Fort Bliss-adjacent demand.

The tax and insurance carry deserves a dedicated line on your underwrite. The model estimates $447 per month in combined property tax and insurance, broken down as $350 monthly in property tax ($4,196 annualized at a 1.80% state-average effective rate) and $97 monthly in insurance ($1,165 annualized). At 1.80%, Texas's state-average rate is high enough to be a real underwriting variable, not a rounding error. On a $233,084 purchase, that tax load alone is 29% of the modeled gross rent. The honest caveat here is that this figure uses a state-average estimate from Tax Foundation 2024 data, and actual county or taxing-district rates in El Paso will differ, potentially in either direction. Pull the specific appraisal district rate for any address you are seriously underwriting before committing to a pro forma.

The primary concentration risk in El Paso is the Fort Bliss dependency. A meaningful reduction in troop levels or a base realignment decision would compress rental demand faster than the broader economic base could absorb. This is not a novel concern for military-adjacent markets, but it is the right specific risk to size. Regulatory risk in Texas is generally favorable for landlords relative to coastal states, and the state preempts local rent control, but investors should verify any municipality-level landlord ordinances in El Paso proper. Demographically, a population of 863,832 provides meaningful scale, which reduces the kind of single-employer or single-event concentration risk that plagues smaller markets.

Against its modeled neighbors, El Paso is the only market in this peer set combining a population above 800,000, an 82nd-percentile national ranking, and a functioning institutional rental demand base. Wichita County at $163,787 median carries a higher rent-to-price ratio of 0.0867, which makes it a better cash-flow candidate on paper, though its smaller scale and economic base introduce different risks. Cottle, Donley, and Dawson counties at medians of $65,066, $107,131, and $102,880 respectively are deeply affordable but lack the liquidity, scale, and institutional demand that make El Paso a defensible long-term hold. Andrews County at $244,485 median and an overall score of 75 is the closest peer score-wise, but without the anchor employment depth that El Paso's military and border economy provides. Choose El Paso over these neighbors when scale, exit liquidity, and a recession-resistant tenant base matter more than headline yield, and when you can either absorb the negative carry at current rates or structure a deal that does not require it.