I (Juan Pesqueira) constantly get asked where I think the Phoenix-Mesa-Scottsdale, AZ real estate market will be in the next few years, so here’s what I think. And I could be completely wrong… or right.
ONE, Phoenix-Scottsdale-Mesa housing market has seen pricing go through the roof in the past 18 months. It’s crazy. And I believe that pricing will stabilize, and we’ll come down to a more steady growth growth of 6% – 13% per year (instead of 20 – 24% & a few spots as high as 35% we’ve seen recently!!!). Early signs (for me) shows a leaning towards the lower end % growth. Zillow has halted buying and flipping. Once they disclose earnings could end up being worse than everyone thought. I think the ibuyer business will slow down quite a bit, some will shut it down. This will only strengthen the end user/first time home buyers, but we still lack inventory. That’s where our market will see steadier growth. We still have a supply and demand issue.
TWO, inventory will normalize, and more housing options will become available as baby boomers go back to listing their homes in the Spring.
- According to Realtor.com, new real estate listings rose by around 5% in August 2021 compared to a year earlier. Within the Phoenix metro area real estate market, new listings rose by 26.3% from July 2020 to July 2021.
- Tracking ARMLS the past six months inventory has slowly been climbing. On April 16, 2021, the inventory was sitting at 4887 homes for sale. Today (October 22, 2021) inventory is at 6116 homes for sale in Maricopa County.
- Realtor.com ‘s chief economist Danielle Hale said that this trend is “shifting the housing market balance in a more buyer-friendly direction.”
THREE, mortgage rates will creep back up from the record lows we’ve seen as the Fed begins to taper purchases of mortgage-backed bonds (mortgage interest rates loosely follow the yield on the 10-year treasury). This can define whether you buy now or continue renting and whether it’s the right time for you to list your property.
Conclusion, All in all, we have a VERY busy few years in the markets coming up. No Phoenix-Mesa-Scottsdale housing crash in sight unless the ibuyer companies overextended, These companies can crash this market!
Juan Pesqueira, Realtor brings 17+ years’ experience selling residential and commercial real estate + appraising residential real estate. I get to see and experience real estate from all angles.