It’s not the heat slowing down Arizona consumers; it’s the economy. Or, more accurately, it’s each person’s personal economy, according to the Arizona Republic. With an unemployment rate of 8.2 percent, Arizonans aren’t feeling much financial security right now.
The news isn’t all gloom and doom, though. The Phoenix real estate market is showing signs of recovery, albeit slowly. Home prices are up and there are more buyers in the market than we’ve seen in awhile. In fact, homes that are priced right and in good condition are sometimes bringing multiple offers. This is great news for sellers but may be discouraging to the first-time Phoenix homebuyer, trying to compete with the cash-rich investors flooding the market.
Although housing starts nationwide are up significantly, the new home market in Phoenix has slowed due to a lack of construction workers and the high price of land. Since the new home market was the major driver of Phoenix real estate market before the recession, traditional buyers are also facing an inventory shortage. Homes priced below $300,000 are in particularly short supply, according to CNBC’s Diana Olick.
Buyers interested in the Phoenix short sale market are urged to be even more creative. With home prices in some areas of Phoenix rising quickly, what you offer on the home today and what it’s worth when the bank gets around to performing its Broker’s Price Analysis may be drastically different. Do your house hunting in the lower range of your preapproval amount so if you need to come up with more money to close, you’ll have access to it.
House Listings in Phoenix
If you decide to brave the investor-infested Phoenix real estate waters you’ll find Phoenix non-distressed single-family home prices range in price from $12,900 for a tear-down to $11,900,000 for a Camelback Mountain estate.
The foreclosure market includes rock bottom priced starter homes to a gorgeous Camelback East home offered at a little over $969,000.
The new home market is seeing a lot of action lately. The Arizona Republic mentions that many new home communities are popping up, primarily in Gilbert. New home prices in Phoenix start at $135,990 for a 2-bedroom, 2-bathroom home in The Ridgerock at Northgate to a stunning 6-bedroom, 8-bathroom Tuscan farmhouse-styled estate in Ahwatukee Foothills, offered at $2,395,000.
Luxury home shoppers face less competition and have lots of choices. An estate on Camelback Mountain, complete with city views and 21,000 square feet of living space is currently offered at $11,900,000. The Alhambra area is home to a Tuscan estate, listed at $3,500,000, on over 2 acres of land. This home features nine bedrooms and 14.5 bathrooms, guest quarters, a 6-car garage and much more.
Since there is far less investor competition in the condo market, first-time buyers may have better luck there. Phoenix condos, lofts and townhouses start at $17,000 for an Encanto Garden townhouse and run to $325,000 for a custom condo in the Roosevelt District. For those who enjoy urban living, check out Portland Place Lofts, Summit at Copper Square or St. Croix Villas.
With multiple offers becoming more common in certain price ranges in Phoenix, it’s important that you make your highest and best offer right out of the gate. Since price and terms are the two most important elements to sellers, offer the highest price you can and keep contract contingencies to a minimum.
Jack O’Neal, real estate expert with Solutions Real Estate in Phoenix, suggests that if you find yourself in competition with investors over the home of your dreams, try writing a personal letter to the sellers, outlining what you love about the house and how owning it will change your life.
You never know – it may just work.