Phoenix real estate market 2019

The Phoenix real estate market has officially recovered from the 2008 housing crisis and is back on track as a recommended market for investors as we enter 2019.

As Arizona’s largest city and the state capital, Phoenix is a massive community with a population of more than one million. The Phoenix housing market encompasses more than the city—the entire Valley area includes Phoenix’s sprawling suburbs, home to an additional five million residents. This makes Phoenix the twelfth largest metro area in the U.S.

According to online real estate company Zillow, the median home value in Phoenix entering 2019 is $235,200—up 8.4 percent over the past year, and Zillow predicts they will rise 4.3 percent in the upcoming year. Further, the median per square foot list price in Phoenix is $167, eclipsing the Phoenix-Mesa-Scottsdale Metro average of $158.

The median price of homes currently listed in Phoenix is $279,650 compared to the median price of homes that sold is $239,300. When it comes to the rental market, the median rent price in Phoenix is $1,397—lower than the Phoenix-Mesa-Scottsdale Metro median of $1,475.

Phoenix’s economy and the number of new residents flocking to the city from other parts of the country are much stronger than they were a decade ago, and forecasters see even more growth ahead,

A look back at the Phoenix real estate market in 2018
In 2018, Phoenix real estate market trends experienced an increase of $16,000 (7 percent) in median home sales and a 3 percent drop in median monthly rent prices. According to Trulia, the average price per square foot in 2018 rose from $148 to $162, an increase of 9 percent compared to the same period in 2017. Trulia reports the median rent per month for apartments in Phoenix for Sep 22 to Oct 22, 2018, was $1,450 and the median sales price for homes in Phoenix for Jul 18 to Oct 17, 2018, was $239,000 based on 5,157 home sales.

Current Phoenix real estate market summary

Median sale price: $239,000
Price per sqft: $162
Median rent per month: $1,450
Median household income: $43,150
Homeowners: 61 percent
Single residents: 35 percent
Median age: 33
College educated: 28 percent

Phoenix AZ single-family homes market summary
Entering 2019, single-family homes continue to drive the Arizona real estate market. Compared to the previous year, single-family homes grew by 4 percent—in particular, previously-owned single-family houses make up the majority of Arizona’s residential sales at 80 percent of all sales. Annually, the number of previously-owned single-family homes are three- to four- times greater than new single-family home sales. In fact, the Phoenix real estate market is one of the top performing markets not only in Arizona but nationwide.

Phoenix home prices and appreciation rates
Arizona’s 2018 real estate market thrived in 2018. The area’s desirable living conditions have encouraged real estate investors and homebuyers to invest in the real estate market. Prices are up 17.8 percent since two years ago and 145 percent since prices bottomed out in May 2011. Taking inflation into account, Phoenix home prices are still 20 percent below the inflation-adjusted peak in 2005.

Phoenix’s real estate appreciation rates have tracked close to the national average over the last 10 years, with the annual appreciation rate averaging 0.74 percent during the period. According to Neigborhoodscout.com, appreciation rates in Phoenix are so strong that, despite a nationwide downturn in the housing market, Phoenix real estate has continued to appreciate in value faster than most communities. Over the past 12 months, Phoenix’s appreciation rates continue to be among the highest in the country at 8.49 percent, which is higher than appreciation rates in 89.96 percent of cities and towns nationwide. Based on the last twelve months, Phoenix appreciation rates in the latest quarter were at 2.22 percent, which translates to an annual appreciation rate of 9.17 percent.

Current trends fairly predict that Phoenix home prices and appreciation rates in 2019 are very likely to exceed 2018. Real estate experts predict median home price increases of at least 25 percent in 2019 and the upcoming few years thereafter. And despite increases in property prices, the Phoenix real estate market remains much more affordable than other parts of the country.

9 reasons to invest in the Phoenix real estate market In 2019

Downtown renovation
Phoenix’s downtown area between Seventh Street and Seventh Avenue is undergoing substantial commercial redevelopment, fueled by more than five billion dollars invested to date. High rise developments and mixed-use projects have already been completed and more are underway. Public transit in this downtown Phoenix has been substantially improved as well, making this area and bordering neighborhoods excellent for finding investment opportunities.
Additional development opportunities
Beyond Downtown Phoenix, development is underway to cultivate 15 additional completely walkable communities across the metro Phoenix area with substantial public transit, more dense housing, and locally provided services. This is a forward-thinking shift from area’s long-standing the suburban sprawl.
Ever-growing student market
The capital cities of most states, the metro Phoenix area is home to a flagship university—Arizona State University in Tempe. Secondary ASU campuses also exist in Downtown Phoenix and, northwest Phoenix, and the neighboring community of Glendale. These campuses have more than 70,000 students. A number of additional universities have campuses in the Phoenix area, including The Arizona Summit Law School, Grand Canyon University and others. More than 100,000 students rent in the Phoenix housing market, making single-family and multifamily real estate investments near any of the Valley area’s campuses a great source of long-term income streams.
Huge tourist market
Most of Arizona’s 200 world-class golf courses are located in and around Phoenix. The Valley is also home to a number of sports teams that attract visitors, as well as a wealth of natural attributes that make the metro Phoenix area a great place to invest in a single family home or condo to rent out to tourists.
The retiree and snowbird lure
America’s huge baby boomer population is retiring en masse, and Arizona’s retiree movement is different than conventional markets. Arizona has long attracted retirees for whom Florida is too expensive or who need a cleaner, allergy-free environment. Many boomers spend winters in Arizona and return to their homes in other regions of the country for the summer months, creating a distinctly diverse opportunity for investors considering the Phoenix real estate market.
Arizona’s landlord-friendly market
Many investors look for opportunities that allow them to earn a stable monthly income stream. That includes rental properties where tenants can be quickly evicted if they don’t pay rent on time or damage property. The Phoenix real estate market is among the most landlord-friendly compared to surrounding states, allowing landlords to serve an unconditional quit notice which guarantees that if a tenant violates their rental agreement or defaults on the rent, they can be evicted quickly. Arizona laws also allow landlords to evict a tenant within ten days for lying on a rental application.
Low Taxes
In 2018, Kiplinger named Arizona the 8th most tax-friendly state in the U.S. The state’s income tax is 2.59 percent for low-income earners and 4.54 percent for wealthier families. A home worth approximately $177,000 comes with a property tax bill of around $1,400, well below other states. Arizona has also been lowering its capital gains tax rate and has a relatively low transfer tax on deeds or land contracts.
Inexpensive properties are available across the market
A major attraction of Arizona’s real estate market is its affordable real estate, especially when compared to Florida and California with median home values at $177,000, homes, although homes in the Phoenix housing market are slightly higher but still considerably cheaper than a starter home in coastal California. Don’t forget that the large retiree market means there is actually strong demand for one-and two-bedroom houses and condos in the Valley, and they’re available at a fraction of the cost of a three-bedroom home.
Value-added enhancements are usually an option
The Phoenix rental market deals with a large retiree population, both permanent and seasonal. To accommodate aging in place, lawmakers have loosened the rules for building “accessory dwelling units” (ADUs), also known as mother-in-law suites. The city also recognizes the need to provide affordable housing, and they allow people to build and rent out ADUs to provide affordable housing, especially for properties within walking distance to public transit. Investors can buy a house, rehab it and an ADU and other aging-friendly features to create two rental properties for little more than the price of one.

Phoenix real estate market