By Shelley Sakala
The North Phoenix real estate market has been on a roller coaster ride in recent years. After hitting record highs in 2021, prices began to cool off in 2022. In December 2022, prices hit bottom, but there are now signs that the market is starting to rebound.
What caused the decline in prices?
From Norterra to Anthem and throughout the Valley, the housing market seemed to have halted in summer of 2022. There are a few factors that contributed to the decline, one was the rise in interest rates. As interest rates went up, it became more expensive to borrow money to buy a home. This led to a decrease in demand, which pushed prices down. Another factor that added to the decline was the increase in inventory. In 2021, there was a shortage of homes on the market, which drove prices up. However, in 2022, the inventory of homes increased, which gave buyers more options and helped to lower prices.
What are the signs of a rebound?
There are a few signs that the Phoenix real estate market is starting to rebound. One is that the number of homes sold has increased in recent months. In May 2022, the number of homes sold in Phoenix was up 10% from May 2021. Another sign is that the number of new listings has decreased. In May 2022, the number of new listings in Phoenix was down 15% from May 2021. This suggests that there is less inventory on the market, which typically leads to higher prices. Currently in 2023 inventory is down 40% from the same time last year, but we are not seeing a buyer frenzy due to high interest rates.
What does this mean for buyers and sellers?
For buyers, the rebound in the Phoenix real estate market means that there are more options available. This could make it easier to find a home that meets your needs and budget. However, it’s important to remember that prices are still relatively high, but the good news is sellers are willing to offer concessions…typically in the form of paying closing costs or a rate buy-down.
For sellers, the rebound in the market means that you’re more likely to get a good price for your home. However, it’s important to be realistic about your expectations. Prices are still below their peak levels, so you may not get as much as you would have a few years ago. Homes that have been updated and show well are moving faster and for more money than those that have not been updated.
Here is some additional market data to back up this sentiment:
• The median home price in Phoenix was $420,000 in December 2022, down from $450,000 in December 2021.
• The number of homes sold in Phoenix was up 10% in May 2022 from May 2021.
• The number of new listings in Phoenix was down 15% in May 2022 from May 2021.
Shelley Sakala is a local realtor and owner of The Sakala Group Real Estate.
