The buyer demand refuses to die down in the Phoenix housing market. Despite the large increase in new listings in September, the available supply of properties is not increasing. It was quite unusual for the number of listings under contract to be higher on October 1 than September 1, but this what the pandemic has done in 2020. The Greater Phoenix real estate market is on fire. The fall season has become as busy for home buying as the summer season.
It is now clear that the pandemic could only pause sales, which in turn created a huge pent up demand. As we saw Arizona real estate market thriving & becoming sizzling hot in the past couple of years, even the rise in mortgage rates was believed not to affect it. Now record low-interest rates are helping boost sales, and it's still a strong seller's market.
The slump in year-over-year sales in April and May impacted the numbers, but the anomaly will most likely be fully erased in October, according to ARMLS's forecast. The Phoenix real estate market has not only recovered after a slump due to COVID-19 but the demand has reached new heights. September recorded the highest median sales price ever reported, the highest average sales price ever reported and the highest sales volume for any September in the past.
Sales were up 18.5% from September 2019 and up 4.8% from August 2020. The average sales price is up +23.1% year-over-year while the year-over-year median sales price is also up +17.5%. A slight increase is forecasted in October for both average sales prices and median sales prices, according to the latest data released by ARMLS on October 20, 2020.
Despite the rise in new listings, the environment is extremely difficult for homebuyers in metro Phoenix. Typically, a market that favors sellers has less than 6 months of supply, while more than 6 months of supply indicates an excess of homes for sale that favors buyers. Months supply of inventory has shrunk to as low as 1.48. As per the current trends, the Phoenix is all set to remain a seller's market in the next 12 months. The prediction is that the upward price trend will continue for the near and medium-term, making any price reductions in 2021 rather unlikely.
Data from ARMLS also shows that the new constructions have seen year-over-year gains in every month in 2020. In September 2020 a total of 1,807 was the highest number of newly built homes sold in September since 2007. the median price of a new build has only risen 5.18% over the past year while resale homes have climbed 19.13%.
Currently, the gap between a median-priced new build and a resale is only $40,397. In September of 2019, the difference was $75,153 With the chronic shortage of re-sale homes, many buyers are turning to new-builds. Here they will not face multiple offers, but they may find some builders are not accepting contracts except for homes that are near completion.
Greater Phoenix Housing Market Report (September 2020)
It is a metropolitan area, centered on the city of Phoenix, which includes much of the central part of Arizona. The source of this report is the Arizona Regional Multiple Listing Service. Here are the ARMLS numbers for September 2020 compared with September 2019.
|Closed sales are up +4.8% month-over-month. The year-over-year comparison is also up +18.5%.|
|New inventory is up +2.9% month-over-month while the year-over-year comparison increased by +14.6%.|
|Total inventory has a month-over-month increase of +2.1% while year-over-year reflects a decrease of -22.5%.|
|Months supply of inventory for August was 1.52 with September at 1.48.|
|The average new list prices are up +11.1% year-over-year.|
|The median list price is up +11.7% year-over-year.|
|The average sales price is up +23.1% year-over-year.|
|The median sales price is up +17.5% year-over-year.|
|Days on market were down -13 days year-over-year while month-over-month went down -5 days.|
Maricopa County Housing Market Report Q3-2020
Maricopa County is a county in Arizona and consists of 43 cities. It is the nation’s fastest-growing county, home to approximately four and a half million people. Maricopa County is a seller's market, which means that there are more people looking to buy than there are homes available. August’s sales were at 99% of the 3 year average of 165 (from 2017-2019). September began with listings at 28% of the 3 year average of 324 (from 2017-2019) (source: valleywidehomes.com).
The median list price of homes in Maricopa County, AZ was $350K in September 2020, trending down -2.5% year-over-year, according to Realtor.com. The median listing price per square foot was $196. The median sale price was $338.5K. On average, homes in Maricopa County, AZ sell after 45 days on the market. The trend for median days on market in Maricopa County, AZ is flat since last month, and slightly down since last year.
Arizona Regional MLS includes Maricopa County and most of Pinal County. Here are the ARMLS numbers for the Maricopa County housing market for the third quarter of 2020.
- The median sales price is up +15.5% YTY.
- The average sales price is up +19.1% year-over-year.
- Closed sales are up 8.9%.
- Inventory is down 14.4%.
- Months Supply is down 13.5%.
- Buyers and sellers are connecting at a faster pace than last year. The median DOM is down 17.8%.
Phoenix Real Estate Market Forecast 2021
What are the Phoenix real estate market predictions for 2021? Let us look at the price trends recorded by Zillow over the past few years. Since 2012, Phoenix housing prices have shown a growth of 160% (from $109,000 to $283,594 – ZILLOW HOME VALUE INDEX). Last year saw was the eighth consecutive year of home price gains. The Zillow Buyer-Seller Index (BSI) considers Phoenix a sizzling hot seller’s real estate market.
Similar growth has been recorded by NeighborhoodScout.com as their data also shows that in the past ten years, Phoenix real estate appreciated by 139.72%. This amounts to an annual real estate appreciation of 9.14%, which puts Phoenix in the top 10% nationally for real estate appreciation.
During the latest twelve months, Phoenix's appreciation rate, at 8.24%, which is higher than appreciation rates in 95.43% of the cities and towns in the nation. In the latest quarter, the appreciation rate has been 2.42%, which annualizes to a rate of 10.02%. This figure also corroborates with Zillow's positive forecast, so the home prices in this region would increase by at least 8-10% in the next twelve months.
The typical home value of homes in Phoenix is $283,594. The typical home value of homes in Phoenix-Mesa-Scottsdale Metro is $309,543. These values (by Zillow) are seasonally adjusted and only include the middle price tier of homes.
Here is the latest housing forecast for Phoenix, Metro Phoneix, and Maricopa County until September of 2021.
- Phoenix home values have gone up 12.6% over the past year and the latest forecast is that they will increase by 8.5% in the next twelve months.
- Maricopa County home values have gone up 11.7% over the past year and the latest forecast is that they will rise 8.3% in the next twelve months.
- Phoenix-Mesa-Scottsdale Metro home values have gone up 11.7% over the past year and Zillow predicts they will rise 7.7% in the next twelve months.
The chart below, created by Zillow, shows the growth of median home values since 2011 and their forecast until September 2021.
Here is a short and crisp Phoenix housing market forecast for the 3 years ending with the 3rd Quarter of 2021. The accuracy of this forecast for Phoenix is 74% and it is predicting a positive trend. LittleBigHomes.com estimates that the probability of rising home prices in Phoenix is 74% during this period. If this price forecast is correct, the Phoenix-Mesa-Scottsdale, AZ home values will be higher in the 3rd Quarter of 2021 than they were in the 3rd Quarter of 2018.
The change in home prices for Phoenix-Mesa-Scottsdale, AZ is shown below for the three-time periods (data up to 3rd Quarter, 2018). The Phoenix Home Price Index has increased for the last 29 consecutive quarters. The highest annual change in the value of houses in the Phoenix Real Estate Market was 41% in the twelve months ended with the 4th Quarter of 2005. The worst annual change in home values in the Phoenix Market was -23% in the twelve months ended with the 4th Quarter of 2008.
The highest growth in home values in the Phoenix Real Estate Market over a three year period was 81% in the three years ended with the 2nd Quarter of 2006. The worst performance over a three year period in the Phoenix Market was -43% in the three years ended with the 2nd Quarter of 2010. For the upcoming updates, you can visit LittleBigHomes.com.
|Time Period||Metro Phoenix Real Estate Appreciation|
|Last 5 Years||50%|
|Last 10 Years||30%|
|Last 20 Years||139%|
The question now is what happens moving forward. These numbers can be positive or negative depending on which side of the fence you are — Buyer or Seller? It is quite evident that the ongoing pandemic has not had any major impact on Phoenix's housing market. However, it was quite expected that social distancing, higher unemployment, and lower overall economic activity would constrain real estate activity in the near term. And it did happen from May onwards. The shutdown has already resulted in 546,900 unemployment filings.
At the same time, the industry is adapting to the current environment by conducting business using technologies such as virtual showings and e-signing to help buyers and sellers with their housing needs in the face of these challenges. COVID-19’s impact on the Phoenix housing market was not that extreme. The Metro Phoenix housing market is extremely strong and has been hitting a number of new records in the last few days.
We can see that supply remains very low indeed (1.48 Months) but has only declined -2.63% over the past month, a much weaker trend than last month. The reason is that sellers have shown great faith by putting up listings after a slump due to COVID-19. New inventory is up +2.9% month-over-month while the year-over-year comparison increased by +14.6%. This increase in new listings appears to be setting in for the long run, which is a little bit of good news for buyers.
What does it mean for homebuyers in Phoenix? The biggest mistake buyers make is sitting around waiting for sale prices to decline while their potential mortgage payment plummets. The average interest rate on a 30-year fixed-rate mortgage fell to a record low of 2.81% as of October 29, 2020. The 15-year fixed-rate mortgage has dropped 2.32%. This is the time for buyers to take advantage before they are increased again. Properties purchased today are expected to strongly appreciate by 8-10% over the next 12 months.
The only con is that lenders are requiring higher credit scores because of looming economic uncertainty. We have already discussed above the latest housing market report for the Phoenix area. It shows no sign of cooling off, surprisingly so. The entire Greater Phoenix area is breaking records over records in sales prices. The start of 2020 was like a nightmare for regular homebuyers of Phoenix due to tight inventory and an increasing rate of price appreciation.
As the economy continues to rebound, the pending home sales in the Phoenix area are climbing again, which indicates that the housing market slowdown this summer would be much less than previously expected. Earlier, housing experts had forecasted that home sales could slow by as much as 80% during this summer. It's still a seller's real estate market in Phoenix, but there are fewer bidding wars on the most affordable homes (less than $500,000) on the market.
The Phoenix and the entire metro area market is so hot that it cannot shift to a buyer’s real estate market. In a balanced real estate market, it would take about five to six months for the supply to dwindle to zero. In terms of months of supply, Phoenix can become a buyer’s real estate market if the supply increases to more than five months of inventory.
And that’s not going to happen. We can conclude that demand has not only recovered from the COVID-19 pandemic but has reached heights that make it very strong by any historical standard. Hence, Phoenix real estate market remains strong and skewed to sellers, due to a persistent imbalance in supply and demand.
Real estate market forecasts given in this article are just an educated guess and should not be considered financial advice. Real estate prices are deeply cyclical and much of it is dependent on factors you can’t control. Many variables could potentially impact the value of a home in Phoenix in 2021 (or any other market) such as big changes in the distressed, new-construction, or luxury home segments. There are also a wide variety of economic and political factors that can and do impact real estate markets. Most of these variables are difficult to predict in advance.
Phoenix Housing Market Prices And Trends 2020 (YTD Summary)
Let’s discuss a bit about the Phoenix metro area and do a quick recap of how its housing market has performed in 2020 so far. We shall mainly discuss median home prices, inventory, economy, growth, and neighborhoods, which will help you understand the way the local real estate market moves in this region.
Phoenix remains the biggest city of Arizona and the state’s capital. It is a minimally walkable city in Maricopa County with a population of approximately 1,442,530 people. However, Phoenix itself is massive. It is the only state capital with more than a million people. It is the fifth-largest city in the country.
The Phoenix housing market is much larger than Phoenix itself – it encompasses the entire Valley of the Sun, Phoenix’s sprawling suburbs that are home to another five million people. That makes the Phoenix metro area the twelfth largest in the country.
The favorable living conditions have, furthermore, comforted real estate investors and buyers to invest in Arizona real estate market. The Phoenix housing market was a headline in the news a decade ago when the housing crisis of 2007 and 2008 caused home values here to fall by as much as half. The slow recovery of the national housing market has taken a decade.
Since 2006, the population has grown faster than housing. This growth fueled by job growth has finally consumed the glut of re-sale housing created during the bubble years. Now the market is facing a shortage of homes for sale. Phoenix home prices were up by roughly 7% over the last twelve months. Despite the increase in property prices, the Phoenix real estate market remains much more affordable than other places.
Single-family homes continue to drive the Arizona real estate market. As compared to 2018, single-family homes grew by roughly 4% in 2019. Particularly, previously-owned single-family houses compromise the majority of residential sales in the Arizona real estate market- approximately 80% of all sales. Annually, the number of previously-owned single-family homes are three to four times greater than new single-family home sales.
The Phoenix real estate market is of the top-performing, not only in the Arizona real estate market but nationwide as well. Phoenix has a mixture of owner-occupied and renter-occupied housing units for sale.
According to Neigborhoodscout.com, a national real estate data provider, three and four-bedroom single-family detached are the most common housing units in Phoenix. Other types of housing that are prevalent in Phoenix include large apartment complexes, duplexes, rowhouses, and homes converted to apartments.
Single-family homes account for about 60% of Phoenix's housing units. Phoenix is also one of the hottest real estate markets in the nation. In the past ten years, the annual real estate appreciation rate has amounted to 7.46%, according to NeighborhoodScout.com. This puts Phoenix in the top 10% nationally for real estate appreciation.
Impact of Covid-19 on The Phoenix Housing Market
Phoenix housing market 2020 started so strong that only something as drastic as the ongoing pandemic could have impeded the real estate sector. The year 2020 started with an extreme shortage of houses for sale, and an increasing number of sales over the asking price of property owners.
In January, many experts expected moderate growth and moderate price appreciation in 2020. In March, Metro Phoenix’s median home price hit a record of $302,500. The median sales price in Maricopa County for Q1-2020 was $309,990, up by + 12.7% from last year. Even in the times of the Covid-19 pandemic, the sales prices in the Phoenix housing market are not declining.
In March and April, there was a year-over-year increase of 13.2% and 11.1% respectively in the reported median prices. In short, Phoenix remains a sizzling hot seller's real estate market in the current cycle. However, it is taking longer for sellers to sell their homes under these conditions. The good thing for buyers in the housing market of Phoenix is that while supply remains at historically low levels, the price growth rate has slowed down a bit.
Also, as some investors are pulling out of the marketplace, the regular homebuyers are getting in a better position to scoop up properties left by them. That's because homebuyers don't have to enter into a bidding war with real estate investors. For sellers, this is the best time to sell for a profit as housing inventory is reported to be at an 8-year low.
In July & August, the Phoenix was a hot seller’s real estate market, which means there were roughly more buyers than there were active homes for sale. The demand for housing has completely outpaced the supply. It also means that the market is very competitive and difficult for buyers.
In July, the median sales price — up 3.3% in a single month, and up 12.5% for the last 12 months. According to ARMLS, the lost sales of late March, April and May began to surface in June and then with greater frequency in July. Sales in the Metro Phoenix housing market have fully recovered and posted a year-over-year increase of almost 13% in July.
The 10,303 home sales were not only the highest number of sales ever in July, but one of the highest monthly totals ever. Although August's housing statistics are yet to be released by ARMLS the total sales in August are expected to surpass July's figures.
Phoenix Real Estate Foreclosure Statistics 2020
Here are some foreclosure statistics of the Phoenix real estate market. As per the Phoenix foreclosure data by Zillow, in Phoenix 0.4 homes are foreclosed (per 10,000). This is lower than the Phoenix-Mesa-Scottsdale Metro value of 0.5 and also lower than the national value of 1.2. The percent of delinquent mortgages in Phoenix is 0.6%, which is lower than the national value of 1.1%. The percent of Phoenix homeowners underwater on their mortgage is 7.4%, which is higher than the Phoenix-Mesa-Scottsdale Metro at 7.1%.
The distressed seller's market is becoming a non-factor in this region. Sep 2020 data released by ARMLS showed that foreclosures pending month-over-month experienced a decrease of -2.9% while the year-over-year figure was down -44.3%. Distressed sales accounted for 0.4% of total sales, the same as the previous month. Short sales dropped -52.0% year-over-year. Lender-owned sales decreased by -29.3% year-over-year.
There are currently 316 properties in Phoenix, AZ that are in some stage of foreclosure (default, auction, or bank-owned) while the number of homes listed for sale on RealtyTrac is 2,496. In September, the number of properties that received a foreclosure filing in Phoenix, AZ was 7% lower than the previous month and 88% lower than the same time last year.
Currently, the zip code with the highest foreclosure rate is 85041, where 1 in every 6101 housing units is foreclosed. 85043 zip code has the lowest foreclosure rate, where 1 in every 10190 housing units become delinquent.
|Potential Foreclosures in Phoenix||316 (RealtyTrac)|
|Homes for Sale in Phoenix||2496|
|Median List Price||$322,500 (2% rise vs Aug 2019)|
Phoenix Real Estate Investment
Should you consider Phoenix real estate investment? Many real estate investors have asked themselves if buying a property in Phoenix is a good investment? You need to drill deeper into local trends if you want to know what the market holds for real estate investors and buyers in 2020. If you are looking to make a profit, you don’t want to buy the most expensive property on the Phoenix real estate market and expect to make a good profit on rents. Perhaps you are looking for a slightly different hold-over, an investment property in Phoenix that you might move into or sell at retirement in the future. Either way, knowing your profit potential and purpose is the first thing to consider.
Top Reasons To Invest In The Phoenix Real Estate Market
Let’s take a look at the number of positive things going on in the Phoenix real estate market which can help investors who are keen to buy an investment property in this city. We’ll address the biggest factor pulling people to the Phoenix housing market next.
Growing And Affordable Real Estate Market
While California and Florida are seen as hot real estate markets, one of the major attractions of the Phoenix real estate market is the affordable real estate. During 2018 and 2019, Arizona was one of the top three states in the nation for population growth. Only Texas and Florida outpaced it, in terms of year-over-year growth.
Population growth is particularly high within the Phoenix metro area. Homes in the Phoenix housing market are approaching the 2006 record. Home-price appreciation appears to be slowing a bit in the Phoenix area and most experts agree that prices will continue to climb for the foreseeable future.
According to data provided by the U.S. Census Bureau, the population for the city of Phoenix rose by nearly 15% from 2010 to 2019. That’s well above the nation’s growth rate for that same timeframe. Population growth increases the demand for housing on both the purchase and rental side. With all other things being equal, steady population growth tends to put upward pressure on home prices.
The median home’s value has crossed $300,000 but that’s still cheaper than a starter home in coastal California. Don’t forget that the large retiree market means there is strong demand for one and two-bedroom houses and condos here, and those units are a fraction of the cost of a three-bedroom home.
Phoenix Rental Market is Huge
There is always going to be high tenant turnover in student housing markets. The presence of universities also influences local home prices and rents. The capital of any state will be home to its flagship university, and Phoenix is no exception. Phoenix is so large that it doesn’t just host the flagship Arizona State University campus in Tempe.
There are secondary campuses in downtown Phoenix, northwest Phoenix, and neighboring Glendale. These schools alone have more than seventy thousand students. The Arizona Summit Law School, Grand Canyon University, and several others are located here. There are easily 100,000 college students renting in the Phoenix housing market. You could invest in large single-family homes or multi-unit buildings to rent to students at any of these campuses.
Phoenix Rental Trends: According to RentCafe, the average rent for an apartment in Phoenix is $1,141, a 10% increase compared to the previous year. 36% of the households in Phoenix are renter-occupied while 63% are owner-occupied. About 89% of the apartments can be rented for less than $1500. Only 2% of the apartments fall in the price range of more than $2,000/month. This shows that the Phoenix rental market is also affordable.
The average size for a Phoenix, AZ apartment is 801 square feet with studio apartments are the smallest and most affordable, 1-bedroom apartments are closer to the average, while 2-bedroom apartments and 3-bedroom apartments offer more generous square footage.
These are some of the most affordable neighborhoods where the rent prices are below the average Phoenix rent of $1,141/mo.
- Estrella Village, where the average rent goes for $879/month.
- Maryvale, where renters pay $926/mo on average.
- Alhambra, where the average rent goes for $942/mo.
- North Mountain Village ($1,017).
- Deer Valley Village ($1,096).
- Camelback East ($1,111).
- Encanto, where the average rent goes for $1,126/mo.
As of September 2020, the average rent for an apartment in Phoenix, AZ is $1330 which is a 7.22% increase from last year when the average rent was $1234, and a 0.53% increase from last month when the average rent was $1323.
- One-bedroom apartments in Phoenix rent for $1189 a month on average (an 8.66% increase from last year).
- Two-bedroom apartment rents average $1436 (an 8.7% increase from last year).
- The average apartment rent over the prior 6 months in Phoenix has increased by $119 (9.8%).
- One-bedroom units have increased by $101 (9.3%).
- Two-bedroom apartments have increased by $122 (9.3%).
Phoenix's Growing Short-Term Rentals
There are more than 200 golf courses in Arizona, but most are located in and around the Valley of the Sun. There are several sports teams located in Phoenix and a wealth of tourist attractions. What makes Arizona unusual is the state’s open relationship with rental sites like Airbnb. A law that went into effect in 2016 made Arizona a leader in Airbnb rentals.
The sites are required to collect taxes on the rentals, simplifying revenue collection for the state and the landlords. That probably explains why Airbnb guests grew by 150% in 2016 alone. The Airbnb market has exploded in Arizona during the past five years. In late 2014, Phoenix only had 687 properties for rent listed on Airbnb. By March of 2019, that number had grown to 4,224 listed properties.
This makes Phoenix a great place to buy a single-family home or condo to rent out to tourists (as a short-term rental). However, there are some restrictions on short-term rentals. In May 2019, the state government passed a bill allowing for more regulations of short-term rental operators in the state of Arizona.
In the bill, municipalities were allowed to restrict rentals to overnight stays and prohibit events that otherwise would require a permit, like weddings. Under the new law, owners of short-term rentals should have a sales tax license and they must list the sales tax license number on any advertisements (online/offline) for the property.
Phoenix is Landlord Friendly
If you want to invest in real estate, you typically want to do so in a market where you can quickly evict people who don’t pay their rent or damage property. You’ll be glad to know that the Phoenix real estate market is among these compared to surrounding states. Arizona, unlike California, allows landlords to serve an unconditional quit notice.
If the tenant violates the rental agreement or doesn’t pay rent, they can be evicted quickly. Renter-friendly rules like requiring a landlord to return a rental deposit within two weeks are not a burden. Conversely, laws that say you can evict a tenant within ten days for lying on a rental application are a definite plus.
The Massive Snowbird Market
The snowbird movement is somewhat different than the conventional tourist market. Arizona has long attracted retirees who couldn’t afford Florida or wanted a cleaner, allergy-free air that never included storm clouds. Quartzite, Arizona in particular draws two million snowbirds and tourists.
The city stands out for its sixty-plus RV parks. An estimated 300,000 people stay all winter before returning home. Some own second homes in Arizona communities restricted to active adults, while others stay in trailer parks. This creates an unusually diverse opportunity for those considering investing in the Phoenix real estate market.
Phoenix Growing Retiree Market
The same things that attract many people to Phoenix as snowbirds cause many to retire here permanently. This means that many snowbirds end up staying permanently in the Phoenix housing market. Sun City stands out as a mecca for seasonal and year-round retirees, but it is far from the only retirement community in the Phoenix real estate market.
The aging of the U.S. population makes investing in communities catering to older adults an excellent idea. Suppose you buy a house to renovate and rent out. Phoenix deals with a large retiree population, both permanent and seasonal. To accommodate aging in place, they’ve loosened the rules on building “accessory dwelling units”, commonly known as mother-in-law suites.
The city also recognizes the need for affordable housing, and they allow people to build and rent out ADUs as affordable housing, especially if the property is within walking distance of public transit. Buy a house, rehab it, and build a granny flat, and you have two rental properties for not much more than the price of one. And the city is almost certain to approve it because they want denser development.
Low Taxes in Arizona
Kiplinger listed Arizona as the 8th most tax-friendly state in the U.S. in 2018. The state income tax is 2.59% for low-income earners, 4.54% for wealthier families. The median home is worth around $177,000 and came with a property tax bill of around $1400, well below what you’d pay in Texas. Arizona has been lowering its capital gains tax rate, as well. The state has a relatively low transfer tax on deeds or land contracts, too.
The Major Wave of Renovation in Downtown Phoenix
The section of Phoenix wedged between Seventh Street and Seventh Avenue is undergoing a wave of commercial redevelopment, fueled by more than five billion dollars invested to date. High rise developments and mixed-use projects have been built, and several more are underway. Public transit in this area is significantly improved. That is making this area and neighborhoods bordering it an excellent place to invest in the Phoenix housing market.
Phoenix isn’t just redeveloping downtown to create a dense, walkable urban core. It is cultivating fifteen complete walkable communities across the metro area with strong public transit, denser housing, and locally provided services. This is a radical shift from the suburban sprawl the area has long been known for.
Phoenix, Arizona Real Estate Investment Markets
Investing in Phoenix's real estate can be a worthy investment due to a steady rate of appreciation. It’s only wise to think about how you can and should be investing your money. In any property investment, cash flow is gold. The Phoenix housing market is one of the hottest markets for 2020. Don’t let memories of the Great Recession bust that cut home values in the Phoenix housing market keep you away.
There are plenty of reasons to invest in the Phoenix real estate market, only ten of which we’ve provided above. Have a look at the Phoenix real estate investment prospects we have provided from various real estate sources and make the best possible decision for yourself. Good cash flow from Phoenix investment properties means the investment is, needless to say, profitable.
The three most important factors when buying real estate anywhere are location, location, and location. The location creates desirability. Desirability brings demand. There should be a natural and upcoming high demand for rental properties. Demand would raise the price of your Phoenix investment property and you should be able to get a good return on your investment over the long term.
The neighborhoods in Phoenix must be safe to live in and should have a low crime rate. The neighborhoods should be close to basic amenities, public services, schools, and shopping malls. A cheaper neighborhood in Phoenix might not be the best place to live in. A cheaper neighborhood should be determined by these factors – Overall Cost Of Living, Rent To Income Ratio, and Median Home Value To Income Ratio.
Some of the popular neighborhoods for buying a house or an investment property in Phoenix are Vistancia, Laveen, Deer Valley, South Mountain, Biltmore, DC Ranch, Arcadia, McDowell Mountain Ranch, Anthem, North Scottsdale, Cave Creek, Old Town, Litchfield Park, Trilogy at Vistancia and North Phoenix.
Phoenix real estate prices are well above average cost compared to national prices. It depends on how much you are looking to spend and if you are wanting smaller investment properties or larger deals such as duplex and triplex in Class A neighborhoods. The inventory is low, but opportunities are there.
Even as Phoenix home prices have reached new heights, the market remains attractive to residential real estate investors. As they continue to compete for potential investment properties at the lower end of the market, the challenges for first-time homebuyers will remain. The homebuyers won’t be able to outbid real estate investors and would end up renting.
As with any real estate purchase, act wisely. Evaluate the specifics of the Phoenix housing market at the time you intend to purchase. These prices are from Realtor.com and can vary from time to time.
The super-hot housing market in Arizona has many other places for real estate investment. The Tucson real estate market is good for investment. Tucson like Phoenix sees a massive influx of snowbirds, retirees who flock here during the winter. That creates a large, seasonal rental market.
The need for many retirees to sell their second homes when they can no longer travel or live independently provides an opportunity to snap up properties at a bargain rate. Better yet, a large number of those properties don’t have a mortgage on them. Other snowbirds sell their condo and move into a single-family home when they decide to stay in Tucson year-round.
Similarly, if you are an investor, Scottsdale has a track record of being one of the best long term real estate investments in the nation. The area contains a mix of families, young professionals, and retirees. There are several reasons to consider investing in the Scottsdale real estate. You’ll see better than average returns on the average Scottsdale real estate investment property, and its value will be bolstered by a variety of factors.
The Scottsdale housing market has a more diverse rental market than just catering to those who can’t afford to buy a single-family home. For example, the area is famous for its snowbirds, retirees who come for the winter before returning home. This makes Scottsdale a good place for real estate investing.
Chandler is bordered by the cities Tempe, Mesa, and Phoenix. It is home to about a quarter-million people. There are not suburbs to Chandler, because it is a suburb of Phoenix surrounded by other cities of similar size. However, Chandler has several points in its favor that make it a better choice for real estate investors than surrounding cities.
The Chandler area offers strong market fundamentals in addition to a favorable tax and regulatory climate. This is in addition to a plethora of high paying jobs that attract new residents and niche markets that are willing to pay higher rents in exchange for convenience and proximity to amenities.
NORADA REAL ESTATE INVESTMENTS has extensive experience investing in turnkey real estate and cash-flow properties. We strive to set the standard for our industry and inspire others by raising the bar on providing exceptional real estate investment opportunities in many other growth markets in the United States. We can help you succeed by minimizing risk and maximizing the profitability of your investment property in Phoenix.
Consult with one of the investment counselors who can help build you a custom portfolio of Phoenix turnkey properties. These are “Cash-Flow Rental Properties” located in some of the best neighborhoods of Phoenix.
Not just limited to Phoenix or Arizona but you can also invest in some of the best real estate markets in the United States. All you have to do is fill up this form and schedule a consultation at your convenience. We’re standing by to help you take the guesswork out of real estate investing. By researching and structuring complete Phoenix turnkey real estate investments, we help you succeed by minimizing risk and maximizing profitability.
Buying or selling real estate, for a majority of investors, is one of the most important decisions they will make. Choosing a real estate professional/counselor continues to be a vital part of this process. They are well-informed about critical factors that affect your specific market areas, such as changes in market conditions, market forecasts, consumer attitudes, best locations, timing, and interest rates.
Is It The Right Time To Invest In Real Estate? – The national homeownership rate is on the decline for the first time since 2017. As demographics change and baby boomers retire, you’re seeing Millennials who may not be ready to buy houses. In 2018, Millennials made up about 22 percent of the population in the United States. They’re choosing to rent over buying a single-family home or an apartment. Rising home prices and shortage of starter homes have not left Millennials many choices but to delay homeownership. Moreover, it's even harder to take out a mortgage for those who have student loan debt.
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Remember, caveat emptor still applies when buying a property anywhere. Some of the information contained in this article was pulled from third party sites mentioned under references. Although the information is believed to be reliable, Norada Real Estate Investments makes no representations, warranties, or guarantees, either express or implied, as to whether the information presented is accurate, reliable, or current. All information presented should be independently verified through the references given below. As a general policy, the Norada Real Estate Investments makes no claims or assertions about the future housing market conditions across the US.
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