How Rising Costs, Rates, and Inventory Are Reshaping Valley Homebuilding
Rising construction costs, higher land prices and changing buyer demand are reshaping the Rio Grande Valley housing market.
In this interview, Nacho Pecina, III, broker and owner of Zapphire Real Estate Group and the incoming 2026 board president for the Greater McAllen Association of Realtors, walks through what affordable new construction looks like today in Pharr. He outlines how labor and material costs have changed over the past decade, and why incentives are becoming more common in a buyer’s market.
The conversation covers inventory levels, land prices, labor shortages, financing realities, and what buyers and sellers should understand before making their next move in the Valley real estate market.
📍 Topics include:
• Affordable housing in the RGV
• New construction costs
• Buyer vs. seller market dynamics
• Labor and land price trends
• What today’s buyers are asking for
The following is an AI-generated transcript of the Podcast with Ramon Ignacio “Nacho” Pecina, III, broker and owner of Zapphire Real Estate Group. Nacho is also the incoming 2026 board president for the Greater McAllen Association of Realtors.
There may be minor mistakes in the transcript. Please refer to the link above or listen on your favorite podcast provider.
Kristen Mosbrucker-Garza: I’m here with the president of the Greater McAllen Board of Realtors. Would you like to introduce yourself?
Nacho Pecina: My name is Nacho Pecina, III. My given name is Ramon Ignacio. I’m broker and owner of Zapphire Real Estate Group, and I’m also the general contractor at Zapphire Construction and Development. I’m the incoming 2026 board president for the Greater McAllen Association of Realtors.
Kristen Mosbrucker-Garza: Let’s check out the house.
Nacho Pecina: Come on in. We’re at 813 East Vegas in Pharr, Texas, just south of the expressway. This is new construction. Welcome.
Kristen Mosbrucker-Garza: This is described as an affordable new construction in Pharr. What’s the price point, and how does it compare to the market?
Nacho Pecina: This home is priced at $195,000. It features Hardy siding with horizontal siding and stone accents. We focus on efficiency. There aren’t many new homes under $200,000 this close to the expressway.
Nacho Pecina: The homes are fully insulated, including interior soundproofing. We try to build homes that last and avoid long-term issues.
Kristen Mosbrucker-Garza: Ten years ago, median home prices in the McAllen-Edinburg-Mission metro were around $130,000. Now they’re closer to $250,000. What happened?
Nacho Pecina: Ten years ago, construction costs were about $110 to $120 per square foot. Today, we’re closer to $160. Land prices, materials and labor have all increased.
Nacho Pecina: I’ve been in real estate for almost 23 years and construction for over 10. Even now, homes are taking longer to sell. This one has been on the market about 45 days, even though we’ve received multiple offers.
Kristen Mosbrucker-Garza: How has demand changed over the past year with inventory levels rising?
Nacho Pecina: For every four sellers, there’s roughly one buyer right now. Inventory is high. Median prices are around $260,000, and homes are staying on the market 45 to 60 days.
Nacho Pecina: Builders are offering incentives like appliances and closing cost assistance to move inventory.
Kristen Mosbrucker-Garza: We’re in a buyer’s market. How has that affected homeowners trying to sell and move up?
Nacho Pecina: Many people bought post-COVID and are now struggling with higher property taxes and insurance. Escrow payments have jumped $300 or more per month for some families.
Kristen Mosbrucker-Garza: Inventory is reportedly at a 20-year high in this metro area. What does that mean for sellers?
Nacho Pecina: Some sellers are pulling homes off the market and refinancing. Others don’t realize they can protest property taxes or shop insurance rates, which can help lower monthly costs.
Kristen Mosbrucker-Garza: From a builder’s perspective, what costs have increased the most?
Nacho Pecina: Across the board, costs have increased. Concrete, framing labor and materials like OSB all rose sharply during COVID. Overall, construction costs are up 20 to 30 percent over the past several years.
Kristen Mosbrucker-Garza: How has the labor situation changed in the Valley?
Nacho Pecina: There’s a shortage of skilled labor, especially for large developments. We’ve been fortunate to maintain reliable crews, but it’s affecting builders throughout the region.
Kristen Mosbrucker-Garza: What about land prices, particularly in Alton?
Nacho Pecina: Subdivision development costs have increased, but lot prices have also risen. The key is staying aligned with market trends and managing costs carefully.
Kristen Mosbrucker-Garza: How is 2025 shaping up compared to last year for new home sales?
Nacho Pecina: Prices aren’t climbing right now, but incentives are common. Savvy buyers are negotiating, especially on homes that have been listed for several months.
Kristen Mosbrucker-Garza: What features are buyers asking for most?
Nacho Pecina: Efficiency, durability and practical layouts. We focus on quality materials and small upgrades that buyers notice once they move in.
Kristen Mosbrucker-Garza: What are the specifications of this home?
Nacho Pecina: This home is 1,270 square feet with three bedrooms and two bathrooms. It includes a wide driveway, indoor laundry area and a fenced yard.
Kristen Mosbrucker-Garza: Any final advice for buyers and sellers?
Nacho Pecina: Shop everything: lenders, insurance, taxes and price. Talk to professionals early and understand your numbers before making offers.
Kristen Mosbrucker-Garza: Thank you for joining us and sharing your insights. Be sure to subscribe to the Rio Grande Valley Business Journal.
