Blog

Phoenix, AZ: Real Estate Market & Trends 2016

For homebuyers and investors alike, there isn’t much to dislike about the Phoenix real estate market. Home prices so far in 2016 are outpacing the national average, while a slew of other factors — employment, home affordability and new housing construction rates — continue to drive the trajectory of the Phoenix real estate market upwards. The median home price for the Valley of the Sun is currently above the national average at $223,100. That said, the Phoenix real estate market is as enticing as ever for seasoned buyers, investors and first-time homebuyers, and should continue in the second-half of 2016.

Phoenix, AZ Real Estate Market Statistics:

Phoenix-real-estate-investments.jpg

One of the glaring positives of the Phoenix real estate market is in home equity gains, which continue to surpass the national average. The first quarter of 2016 saw Phoenix real estate appreciate at a rate of 8.2 percent compared to the national average of 6.1 percent, while the three year average hit 32.0 percent compared to 22.6 percent. Although growth has slowed, the Phoenix area continues to be a hotspot for investors and homebuyers thanks to accelerating appreciation rates. For those looking to invest in the Phoenix real estate market, the following provides a breakdown of appreciation rates in previous years:

  • Homes purchased in the Phoenix, AZ housing market one year ago have appreciated, on average, by $20,459. The national average was $15,781 over the same period.
  • Homes purchased in the Phoenix, AZ housing market three years ago have appreciated, on average, by $63,247. The national average was $49,356 over the same period.
  • Homes purchased in the Phoenix, AZ housing market five years ago have appreciated, on average, by $106,102. The national average was $68,727 over the same period.
  • Homes purchased in the Phoenix, AZ housing market seven years ago have appreciated, on average, by $108,023. The national average was $59,758 over the same period.
  • Homes purchased in the Phoenix, AZ housing market nine years ago have appreciated, on average, by $63,334. The national average was $16,435 over the same period.

As shown above, home equity gains in Phoenix have eclipsed the national average for nine consecutive years. Gains in the past three years have extended the trend of positive price growth after the recession. That said, Phoenix real estate investors and homeowners saw the biggest gain in year five where home prices appreciated on average by a whopping $106,102; compared to the national average of $68,727.

As of June 2016, there are currently 5,151 properties in the Phoenix area in some stage of foreclosure. According to RealtyTrac, the number of Phoenix foreclosures in the month June was 19 percent higher than the previous month and two percent higher than the same time in 2015. Additionally, the number of REO properties increased 3.8 percent from the previous month while falling a 30.3 percent from the same time last year.

Phoenix, AZ: Real Estate Market Summary:

Phoenix housing market

  • Current Median Home Price: $223,100
  • 1-Year Appreciation Rate: 8.2%
  • 3-Year Appreciation Rate: 32.0%
  • Unemployment Rate: 4.5%
  • 1-Year Job Growth Rate: 3.6%
  • Population: 1,600,000
  • Median Household Income: $50,068

Phoenix, AZ: Real Estate Market (2016) — Q1 Updates:

Phoenix real estate investing

The Phoenix real estate market continues to thrive during current conditions thanks to several critical components. Along with growing home prices and appreciation rates, the Phoenix area is enjoying an improved economy. The current unemployment rate is 4.5 percent, a decline of 0.8 percent since last year, and 0.5 percent better than the national average of 5.0 percent. To top things off, the job growth rate in Phoenix was 3.6 percent during the Q1 compared to the national average of 2.0 percent. The Arizona economy is stronger than the nation’s, according to the National Association of Realtor’s State Economic Activity Index, as it continues to grow at a rate of 4.6 percent compared to the national average of 3.1 percent.

Another component driving the Phoenix housing market is home affordability. Although historically strong, the ratio of income paid to monthly mortgage payments in the Phoenix area was 11.6 percent during the first quarter of 2016, which is actually better than its historical average of 13.3 percent, and better than the national average in Q1 of 14.5 percent. Believe it or not, the Phoenix housing market is more affordable than most markets in the nation. In addition, the current level of new housing construction is 62.2 percent above the long-term average, with single-family housing permits growing by 45.8 percent compared to the national average of 11.3 percent. That said, Phoenix real estate investments should see a bump in coming years.

Moving forward, the National Association of Realtors forecasts the Arizona market to see weaker price growth in the next 12 months. Price expectations for the Phoenix real estate market in the first quarter was 2.7 percent, which is below the national average of 3.8 percent. Although forecasts have identified a slow down period for the Phoenix real estate market in coming months, investors and potential homebuyers should expect to see mild improvements for the second-half of 2016.

*The information contained herein was pulled from third party sites. Although this information was found from sources believed to be reliable, FortuneBuilders Inc. makes no representations, warranties, or guarantees, either express or implied, as to whether the information presented is accurate, reliable, or current. Any reliance on this information is at your own risk. All information presented should be independently verified. FortuneBuilders Inc. assumes no liability for any damages whatsoever, including any direct, indirect, punitive, exemplary, incidental, special, or consequential damages arising out of or in any way connected with your use of the information presented.

🔒 Your information is secure and never shared. By subscribing, you agree to receive blog updates and relevant offers by email. You can unsubscribe at any time.