Archives for August 2025

The Milwaukee housing market is currently holding its own, proving to be one of the most resilient in the nation. Even with the broader U.S. market cooling down, Milwaukee is showing impressive growth, with home sales up 12% year-over-year and prices up 8.2%. Let's dive into why Milwaukee is bucking the trend, according to a new report from Redfin, and what you can expect if you're planning to buy, sell, or invest in Cream City real estate.

Milwaukee Housing Market Trends in 2025: Still a Hot Spot?

Why Milwaukee is Outperforming the Nation

As someone who has been keeping a close eye on the real estate market for years, I've noticed a fascinating shift. While the Sun Belt states that boomed during the pandemic are now experiencing a slowdown, the Rust Belt is making a comeback. Milwaukee, located in the heart of the Rust Belt, is a prime example of this resurgence.

There are several factors contributing to this:

• Location, Location, Location: Milwaukee's strategic location in the Midwest makes it a desirable place to live. It's close to major cities like Chicago and has a lower cost of living compared to coastal hubs. This is a big win for buyers seeking affordability.
• Affordability Matters: Even with rising prices, Milwaukee is still more affordable than many other major U.S. cities. This is a major draw for both first-time homebuyers and those looking to relocate from more expensive areas.
• Demand Outpacing Supply: While inventory is increasing slightly, it's not keeping pace with demand. This creates a competitive market where homes are selling quickly and often above the list price.
• Mortgage Rate Advantages: Many homeowners don't want to lose their ultra-low mortgage rates from previous years so they are staying put.

Milwaukee's Housing Market: Key Trends in 2025

Let's break down some key metrics to get a clearer picture of what's happening in the Milwaukee real estate scene:

As you can see, Milwaukee is significantly outperforming the national average in several key areas. Prices are rising at a much faster rate, homes are selling more quickly, and a larger percentage of homes are going under contract within two weeks. This all points to a strong seller's market.

The Milwaukee Advantage: What Makes It Unique

What sets Milwaukee apart from other booming cities like Las Vegas or Miami? For starters, Milwaukee offers a unique blend of urban amenities and Midwestern charm. You get access to big-city perks without the overwhelming costs that come with New York or L.A. Also, the strong presence of manufacturing gives it better economic stability than other smaller cities.

Here are some key factors that stand out to me:

• The “Chicago Effect”: Milwaukee's proximity to Chicago is a major selling point. Many people who work in Chicago choose to live in Milwaukee for its lower cost of living and more relaxed atmosphere.
• A Growing Job Market: Milwaukee's economy is diverse, with strengths in manufacturing, healthcare, and technology. This creates a stable job market that attracts new residents.
• A Thriving Cultural Scene: From the Milwaukee Art Museum to the Summerfest music festival, Milwaukee offers a wide range of cultural attractions.

Expert Insights: What the Locals Are Saying

I always like to hear what the local real estate agents are saying on the ground. According to W.J. Eulberg, a Redfin Premier agent in Milwaukee, the market is “red hot,” but not quite “white hot” like during the peak of the pandemic. Even though the frenzy has calmed down a bit, homes are still getting snatched up quickly due to the inventory shortage.

He shared a recent success story about a listing in South Milwaukee that received seven offers within a few days and sold for $50,000 over the list price. This is a prime example of how competitive the Milwaukee market remains.

Challenges and Opportunities in the Milwaukee Market

While the Milwaukee housing market is thriving, it's not without its challenges. One of the biggest issues is the lack of new construction. There's not much room to build in Milwaukee proper, and many of the new homes that are being built are not affordable for first-time homebuyers.

Here's my take on the current landscape:

• Opportunity for Investors: Investors may find potential in revitalizing older properties or exploring development opportunities in the surrounding suburbs.
• Importance of Fair Pricing: Sellers need to price their homes competitively to attract buyers in today's market. Overpriced homes are likely to sit on the market for longer.Fair pricing = quick sale
• Emphasis on Home Condition: Homes that are in good condition and well-maintained are more likely to sell quickly and for a higher price. This may require some elbow grease, but the efforts pay off.

Milwaukee Housing Market Forecast: Riding the Wave Through 2026

After a somewhat sluggish period, is the Milwaukee housing market ready to kick things up a notch? As the saying goes, “past performance is not indicative of future results” but it sure does give us a solid foundation to work with. Second quarter data from the Greater Milwaukee Association of REALTORS® (GMAR) reveals an interesting story. While we saw a solid 1.6% increase in home sales compared to last year, a deeper dive combined with a touch of foresight suggests the Milwaukee housing market forecast for 2025-2026 is nuanced, so, let's get into it!

2025: A Tale of Two Quarters

The first half of 2025 paints a mixed picture:

• Overall Growth: The four-county metro area saw a 1.6% increase in total home sales.
• June Surge: June specifically experienced a significant 13.7% jump in sales compared to June of the previous year. This is an encouraging sign, but we can’t get ahead of ourselves just yet.It should be highlighted that this June jump is relative to the weaker sales numbers recorded from 2024.
• The Inventory Squeeze: Despite increased listings, inventory is still critically low, with only about 3.2 months of supply available. If you take away listings with pending offers, you go down to only 1.4 months of inventory.This means buyer competition will remain intense for the foreseeable future.
• Price Appreciation: Average prices in the metro area are up 5.4%, hitting $457,573. Milwaukee County saw a whopping 9.9% price increase! This indicates strong seller control in the market. With more cash for fewer houses, prices are likely to remain high.

Here is a quick view of the summary

The Inventory Puzzle: Why Is It So Low?

According to GMAR, the low inventory is not due to a lack of buyers, but rather a lack of homes for sale. This is driven by two key factors:

1. Interest Rate Lock-In: Many homeowners are hesitant to sell because it would mean giving up their low mortgage rates from before mid-2022. This reduces the number of homes hitting the market.
2. Limited New Construction: The area is not building enough new homes to keep up with demand. New construction is vital to ease price pressures and meet the needs of the growing population.To reach a balanced market, we would need an additional 3,910 units added to the inventory.

Forces at Play: Why Milwaukee and Why Now?

Milwaukee's housing market challenges are amplified by broader trends:

• Generational Demand: Millennials and Gen Z are entering the housing market in full force, competing with Baby Boomers looking to downsize. This combination of first-time buyers and empty-nesters creates huge demand, which is not easily met.
• Construction Challenges: New home construction is slower than it's been historically.
• Economic Landscape: The broader economic situation has a tremendous effect on consumers. This can affect their ability to buy and to sell.
• Government Policies: Government decisions at many level have an effect on housing.

My Forecast for the Milwaukee Housing Market:

Taking all of these factors in consideration, here is what it looks like Milwaukee's housing market will yield in 2025-2026:

• Continued Price Growth (Moderated): I expect prices to continue rising, but at a slower pace than the nearly 10% increase seen in Milwaukee Co. It should drop to maybe 5-7% increase. The initial surge is likely over, because high prices will eventually temper demand.
• Low Inventory Persists: Unfortunately, it's likely that inventory challenges will continue into 2026, unless there is a significant change in interest rates, new construction volume, or a major economic shift.
• Competition Remains Intense: With low inventory, buyer competition will remain high, meaning that homes located on prime real estate like Waukesha will continue to be in high demand by growing families.
• Slightly More Balanced Market: Expect a slight shift towards a more balanced market, where buyers have slightly more bargaining power. However, it will still favor sellers because if inventory doesn't keep up with sales, the low supply will drive costs up.

How to navigate the market if the trends come true:

The Long-Term Implications

Milwaukee's housing shortage has implications beyond just the current market conditions:

• Wealth Inequality: If people remain in rental units, they'll miss out on the wealth-building potential of homeownership, which further exacerbates wealth gaps.
• Economic Impact: Limiting homeownership can impact the local economy, as homeowners tend to invest more in their communities.

Should You Invest in the Milwaukee Real Estate Market?

Milwaukee is a city in Wisconsin that offers real estate investors a lot of opportunities. With a population of over 590,000 people, it is the largest city in the state and offers a diverse range of neighborhoods, property types, and investment opportunities. Here are some of the top reasons to consider investing in Milwaukee's real estate market:

• Affordability: Compared to other major metropolitan areas in the United States, Milwaukee offers relatively affordable real estate prices. This means that investors can find deals on both residential and commercial properties that are priced lower than similar properties in other cities.
• Strong rental demand: Milwaukee has a strong rental market, with a high percentage of residents who rent their homes. According to data from the U.S. Census Bureau, over 50% of Milwaukee's residents are renters. This creates a significant demand for rental properties, particularly in areas that are close to downtown, universities, or other major employers.
• Growing economy: Milwaukee has a diverse economy that is experiencing steady growth. The city is home to a range of industries, including manufacturing, healthcare, finance, and education. According to the Milwaukee Economic Development Corporation, the city has seen a 13.5% increase in employment since 2010, and the unemployment rate has dropped from 9.5% in 2010 to 3.5% in 2022. A growing economy typically translates to increased demand for real estate, both from businesses and from residents.
• Low vacancy rates: With strong demand for rental properties, it's not surprising that Milwaukee has a relatively low vacancy rate. According to data from RentCafe, the overall vacancy rate in Milwaukee was 5.5% in 2021, which is lower than the national average of 6.8%.
• Urban revitalization: Milwaukee's downtown and surrounding neighborhoods have undergone a significant revitalization in recent years, with new development projects and investments in public spaces. The city has also seen an increase in younger residents who are attracted to urban living. This has led to an increase in demand for properties in walkable neighborhoods that offer amenities like restaurants, bars, and shopping.
• Favorable landlord-tenant laws: Wisconsin has landlord-friendly laws that make it easier for property owners to manage their rental properties. For example, landlords can evict tenants for non-payment of rent with just a five-day notice, and there are no limits on the amount that landlords can charge for security deposits. This can make investing in rental properties less risky for investors.
• Availability of financing: Like many other cities, Milwaukee has a range of financing options available for real estate investors. Local banks and credit unions offer commercial real estate loans, and the city has a range of public-private partnerships that provide funding for development projects. Additionally, there are a variety of federal and state programs that offer to finance affordable housing projects and other real estate development initiatives.

Therefore, Milwaukee's real estate market offers several compelling reasons to invest. The city has a strong economy, affordable prices, a growing rental market, and a diverse population. These factors, combined with tax incentives and a robust infrastructure, make Milwaukee an attractive location for real estate investors. However, like any investment, there are risks involved, and investors should carefully consider their options before investing.

Is now a good time to buy or sell in San Antonio? That's the million-dollar question (or maybe the $324,460 question, which is the median home price right now!). The San Antonio Housing Market currently paints a picture of stability amidst subtle shifts. While sales have dipped slightly, home prices are holding strong. We're seeing more inventory, which means buyers have more choices, but pending sales are also down, suggesting some caution. So, let's dive into the details and break down what this all means for you.

San Antonio Housing Market Trends in 2025:

The San Antonio Housing Market is a fascinating blend of tradition and modernity, where historic charm meets vibrant economic growth. Over the years, San Antonio has emerged as a prime destination for homebuyers and investors alike, drawn to its rich culture, expanding job opportunities, and relatively affordable living compared to other major U.S. cities.

With a diverse population and a strong sense of community, the housing landscape in this dynamic city reflects a unique combination of demand and supply. We'll explore the trends in home sales, pricing, and inventory that are shaping the future of the housing market in San Antonio.

Here's a quick overview of what the San Antonio housing market looked like in June 2025, based on the latest data from the San Antonio Board of Realtors (SABOR):

Diving Deeper: What These Numbers Really Mean

Okay, now let’s unpack these figures and understand their implications.

Sales Volume: A Slight Slowdown

The 1% dip in home sales is a notable, albeit subtle, shift. It suggests that the frenzy we might have seen in the past few years is cooling off. This isn't necessarily a bad thing. It could signal a move towards a healthier, more sustainable market where buyers aren’t forced to make rushed decisions. I believe this slight decrease might also be attributed to higher interest rates, which make mortgages more expensive and can deter some potential buyers.

Price Stability: Good News for Sellers (and Buyers, too!)

The fact that both the median and average home prices are up 4% year-over-year indicates that the demand for housing in San Antonio remains strong. This is reassuring for sellers who want to get a good price for their property. However, I think it's also important news for buyers. Gradual price increases are far easier to manage than the rapid spikes we've seen in the past. A steady market allows buyers to make more informed decisions without feeling pressured to overbid.

Inventory is Increasing: More Options for Buyers

A 14% jump in active listings means buyers have more choices than they did last year. More inventory generally puts buyers in a slightly stronger negotiating position, allowing them to be more selective and potentially haggle on price, repair cost, or close dates. However, the decrease of 10% in new listings gives rise to the question of if the surge in active listings will continue in the near future.

Pending Sales Decline: Buyer Caution

The most significant drop is in pending sales, which fell by 21%. This signals buyer caution, which can be due to rising interest rates, economic uncertainty, or simply buyers taking their time to make considered decisions. As Reagan Williamson, SABOR’s 2025 Chair of the Board, pointed out, buyers are “weighing their options more carefully.” I feel this is an important trend to follow, as a continued decline in pending sales could exert downward pressure on prices in the coming months.

Months of Inventory: Approaching a Balanced Market

“Months of inventory” is a key indicator of whether a market favors buyers or sellers. A balanced market typically has around 6 months of inventory. With San Antonio’s 5.88 months of inventory, we're edging closer to that balance. This means neither buyers nor sellers have a significant advantage. I think this is a positive development for the overall health and stability of the San Antonio housing market.

Days on Market: Patience is a Virtue (Especially for Sellers)

The rise in days on market (DOM) from 64 to 75, means it now takes longer to sell a home in San Antonio. This is a pretty natural result of increased inventory. If you’re a seller, you need to be prepared to be patient and potentially make price adjustments. I’d advise sellers to work with their realtors to ensure their homes are properly staged and priced competitively.

San Antonio Housing Market: Key Metrics

Bexar County: Mirroring the Regional Trends

While specific Bexar County data isn't available in the provided material, it's safe to assume that the county is generally following the same trends as the broader San Antonio market: stable pricing and lower sales volume. I’d advise residents of Bexar County to keep a close eye on local data as it becomes available to get a more granular understanding of their specific neighborhood trends.

Texas-Wide Perspective: San Antonio in Context

Looking at the Texas real estate market as a whole, things look pretty positive. In June 2025:

• Total Homes Sold: 30,516 (Up 8.2% year-over-year)
• Average Price: $449,555 (Up 4.1% year-over-year)
• Median Price: $350,000 (Up 0.4% year-over-year)

Compared to the state as a whole, San Antonio's price increases are steady and sustainable. Statewide, the home sales are growing faster than in San Antonio indicating the Texas Market is hot right now.

My Personal Opinion

As someone who's been watching the San Antonio real estate market closely for a while, my take is that we're entering a more balanced and predictable phase, that favors neither the buyers nor sellers. The pandemic-era boom is definitely over, and while prices aren't plummeting, buyers now have more room to breathe, more choices, and some level of bargaining power.

For sellers, success hinges on being realistic about pricing and being willing to negotiate. Overpricing your home could lead to it sitting on the market for an extended period, which ultimately may lead to a price reduction and even a lower final sales price, than if the home was priced correctly at the start.

Buyers should take advantage of the increased inventory, work with a knowledgeable agent, shop around for the best mortgage rates, and take their time to find the right property.

Looking Ahead: What to Expect

Predicting the future is always tricky, but here's what I expect to see in the San Antonio housing market in the coming months:

• Continued Price Stability: I don't anticipate any dramatic price swings in either direction. Gradual appreciation is the most likely scenario. The increase in active listings may cause some dips, but the prices will remain stable.
• Slightly Longer Selling Times: Homes will likely take longer to sell than they did a year or two ago.
• Importance of Strategy: Both buyers and sellers need to be strategic. Sellers need to price competitively and stage their homes well. Buyers need to be patient and prepared to negotiate.

Rentals in San Antonio:

If you are more keen on renting, there is some data on it as well. The average residential rental price in San Antonio is $1,922. There are about 4,402 active residential listing but these numbers do not indicate whether the rental market is hot or there is sufficient inventory.

San Antonio Housing Market Forecast 2025-2026: What's Next?

You're probably wondering what's going to happen with home prices. Well, here's the scoop: the San Antonio housing market forecast indicates a continued slight downward trend in the next year, but don't expect a crash. The market is expected to correct slowly. It may provide some opportunities for buyers, but sellers might need to adjust their expectations. Let's dig into the details!

Right now, the average home value in the San Antonio-New Braunfels area is around $286,339. That's down about 3.3% over the last year, according to Zillow. Homes are going under contract in about 37 days, which means the market isn't as hot as it was a couple of years ago, but it's still moving.

The Forecast:

Zillow's latest forecast gives us a glimpse into the near future. Here's what they're predicting for the San Antonio area based on their data as of June 30, 2025:

This suggests that San Antonio isn't expected to see a significant drop. Instead, it looks like a gradual correction, and a normalization of inflated prices.

How San Antonio Compares to Other Texas Markets

Let's see how San Antonio stacks up against other major Texas cities:

As we can see, San Antonio's expected dip is somewhere in the middle. Austin, for example, is predicted to see a steeper decline. Cities like McAllen and El Paso are expected to become stable and appreciate a little bit more.

National Outlook and Mortgage Rates

Lawrence Yun, the Chief Economist at the National Association of Realtors (NAR), thinks things are looking up nationally. He believes that “brighter days may be on the horizon”. He projects the following:

• Existing home sales to increase by 6% in 2025 and 11% in 2026.
• New home sales to jump by 10% in 2025 and another 5% in 2026.
• Median home prices to increase modestly, by about 3% in 2025 and 4% in 2026.
• Average mortgage rates to be around 6.4% in the second half of 2025 and drop to about 6.1% in 2026.

While the national trends are not sharply positive they aren't predicting a sharp crash.

Will Home Prices Drop Significantly in San Antonio?

Based on the available data from reliable sources, a major housing market crash in San Antonio seems unlikely. The forecasts point toward a moderate price correction and then stabilization.

However, there are other factors that can influence price increases or decreases like migration trends, job availability and the economy in general.

Looking Ahead: Possible Forecast for 2026

Predicting beyond a year is tough, but if the national trends hold, we could see the San Antonio market stabilizing sometime in 2026, possibly with a slight increase in home prices.

Final Thoughts: As someone who's been watching the real estate market, I think we're heading towards to a more balanced, dare I say normal, market. This does not mean that the current housing crunch is over, we are only talking about normalization when it comes to prices.

San Antonio Real Estate Investment: Should You Invest Here?

San Antonio is a city located in South Central Texas that has shown steady growth in its real estate market over the years. With its strong economy and affordable cost of living, San Antonio is a great place for real estate investment. Whether you are a first-time investor or an experienced one, San Antonio offers a wide range of real estate opportunities.

Top 7 reasons to invest in San Antonio for the long term:

• Strong Job Market: San Antonio's economy is diverse and has a low unemployment rate, which makes it an attractive place for job seekers. This means that the demand for housing will continue to grow, making it an ideal place for real estate investment.
• Affordable Housing: San Antonio's housing market offers affordable options for both investors and homebuyers. With a lower median home price compared to other major cities in Texas, San Antonio offers a chance for investors to buy properties at a lower cost.
• Population Growth: San Antonio is among the fastest-growing cities in the United States, with a population growth rate of 16.5% from 2010 to 2020. This population growth has resulted in a high demand for housing, which translates to a stable real estate market for investors.
• Military Presence: San Antonio is home to several military bases, which has a positive impact on the local economy. The presence of military personnel means that there is a consistent demand for housing in the area, making it an ideal place for real estate investment.
• Pro-Business Climate: San Antonio is known for its pro-business environment, which attracts new businesses and creates job opportunities. This environment helps to keep the local economy stable and supports the growth of the real estate market.
• Favorable Landlord-Tenant Laws: Texas has some of the most favorable landlord-tenant laws in the country, which can make investing in San Antonio's real estate market less risky for investors. These laws provide landlords with more control over their properties and help ensure that tenants fulfill their lease agreements.
• Strong Rental Demand: San Antonio has a strong rental market, with a vacancy rate of less than 6%. This means that there is a high demand for rental properties, which can help investors generate a steady stream of rental income.
• Appreciation Potential: San Antonio's real estate market has been appreciating steadily over the past decade, and this trend is expected to continue in the coming years. This means that investors who purchase property in San Antonio now could see their investments appreciate in value over time
• Favorable Tax Laws: Texas has favorable tax laws for real estate investors, including no state income tax and low property taxes. This can help investors save money on taxes and increase their net returns on investment.
• Tourism: San Antonio is a popular tourist destination, attracting millions of visitors each year. The city is home to several famous landmarks, including the Alamo and the River Walk, which contribute to the local economy and provide additional opportunities for real estate investment.
• Quality of Life: San Antonio offers a high quality of life with excellent schools, affordable cost of living, and a warm climate. This makes it an attractive place for families and retirees, which in turn increases the demand for housing and creates a stable real estate market for investors.
• Low Cost of Living: San Antonio's low cost of living makes it an attractive destination for residents and investors alike. The city offers affordable housing, transportation, and entertainment options, which can help investors maximize their returns.

Overall, San Antonio's growing population, diverse housing options, strong economy, and favorable landlord-tenant laws make it an attractive destination for real estate investors. With strong rental demand, appreciation potential, and favorable tax laws, San Antonio is a promising market for long-term real estate investment.

So, you're wondering about the current Scottsdale housing market trends? As of mid-2025, the Scottsdale housing market appears to be shifting towards a buyer's market, presenting a balanced scenario with opportunities for both buyers and sellers. Let's dive in to find out more about this housing market in 2025.

Scottsdale Housing Market Trends in 2025:

Home Sales

Let's dive into the numbers. Home sales are a good indicator of how active the market is. According to the data by Scottsdale REALTORS®, in June 2025, the median sold price for homes in Scottsdale was $920,000. This shows a 2.22% increase month-over-month. A lot of homes are changing hands, so the demand is still high.

Home Prices

One of the biggest questions everyone has is about home prices. Are they going up, down, or staying the same? As mentioned above, the median sold price in June 2025 was $920,000. However, it's important to look at the bigger picture. The median estimated value is $863,980 showing a change of 1.4% over the past 12 months.

Are Home Prices Dropping in Scottsdale?

The million-dollar question (well, almost a million!). While the median sold price did increase from May to June, the rate of increase is slowing down. It's not a freefall, but we're not seeing the crazy price jumps we saw a few years ago. From the looks of it, the median list price is $985,000, down 1.4% MoM.

Housing Supply

How many homes are available for sale? This is called the housing supply, and it plays a huge role in determining whether it's a buyer's or seller's market.

In June 2025, the months supply of inventory was 8.18. This means that at the current rate of sales, it would take about 8 months to sell all the homes currently on the market. This is a 9.01% increase month-over-month, and a 42.5% increase over the last 12 months.

Is Scottsdale a Buyer's Housing Market in 2025?

Here's the deal: a balanced market usually has around 5-6 months of inventory. Anything above that starts to favor buyers, and anything below favors sellers. With over 8 months of inventory, Scottsdale is leaning toward a buyer's market, which means that buyers may have more negotiating power.

Market Trends Based on recent data, here's a quick snapshot of the Scottsdale housing market:

Impact of High Mortgage Rates

Of course, we can't talk about the housing market without mentioning mortgage rates. These rates have a big influence on what people can afford.

Currently, U.S. weekly averages as of 07/31/2025, the average 30-year fixed mortgage rate is around 6.72% and 15-Yr FRM is about 5.85%, according to Primary Mortgage Market Survey® by Freddie Mac. The 30-year fixed-rate mortgage showed little movement, remaining within the same narrow range for the fourth consecutive week. Continued economic growth, along with moderating house prices and rising inventory, bodes well for buyers and sellers alike. According to various forecast, 30-year FRM rate will end 2025 between 6.0 to 6.5 percent. Borrowers should find comfort in the stability of mortgage rates, which have only fluctuated within a narrow 15-basis point range since mid-April.

High mortgage rates mean that borrowing money to buy a house is more expensive. This can cool down demand and put downward pressure on prices. Although rates are expected to slightly decline at the end of the year, they are still relatively high.

My Two Cents

I've been watching the Scottsdale market for a while now, and I think we're entering a more balanced phase. The days of bidding wars and homes selling way over asking price seem to be behind us. While prices might not plummet, buyers have a bit more breathing room. For sellers, it means being realistic about pricing and making sure your home is in tip-top shape to attract potential buyers. Working with an experienced real estate agent is more important than ever to navigate these changing conditions.

The Bottom Line – The Scottsdale housing market trends in mid-2025 show a market that's shifting toward a buyer's advantage. Inventory is up, price increases are moderating, and mortgage rates are influencing affordability.

Scottsdale Housing Market Forecast 2025-2026: What's Ahead?

Predicting the future is tough, especially in real estate! However, by analyzing the current Scottsdale housing market trends and considering broader economic factors, we can sketch out a possible scenario for 2025-2026.

Key Factors Influencing the Forecast

Before we dive into specifics, here are the main things that will likely shape the Scottsdale housing market over the next year or so:

• Mortgage Rates: As we mentioned before, mortgage rates are a huge driver. If they stay elevated, it'll keep pressure on affordability. Any significant drops could spark more demand.
• Inventory Levels: The supply of homes for sale will continue to be a crucial factor. Will it keep rising, level off, or even start to decline?
• Economic Growth: The overall health of the economy, both nationally and locally, will impact people's ability and willingness to buy homes.
• Migration Patterns: Is Scottsdale still attracting new residents from other states? Strong population growth fuels housing demand.

Possible Scenarios

Given these factors, here are a few potential paths the Scottsdale housing market could take:

Scenario 1: The “Slow and Steady” Market

• Mortgage rates remain relatively stable at around 6% – 6.5%.
• Inventory gradually increases but doesn't reach extreme levels.
• The economy continues to grow at a moderate pace.
• Migration to Scottsdale remains positive, but slows down slightly.

In this scenario, we'd likely see:

• Home prices remain relatively flat, with small increases in some areas and minor decreases in others.
• Days on market stay elevated, giving buyers more time to consider their options.
• Negotiating power remains in favor of buyers, but not overwhelmingly so.
• Overall market activity is moderate and fairly predictable.

Scenario 2: The “Buyer's Market Deepens”

• Mortgage rates rise slightly further, perhaps peaking near 7%.
• Inventory continues to build as more sellers enter the market.
• Economic growth slows down, leading to some job losses.
• Migration to Scottsdale stagnates or even declines slightly.

In this scenario, we could see:

• Home prices experience more noticeable declines, particularly in the luxury market.
• Homes take longer to sell, and price reductions become more common.
• Buyers have significant negotiating leverage, potentially getting great deals.
• Foreclosure activity might start to tick up (though not to the levels seen during the housing crisis).

Scenario 3: The “Unexpected Rebound”

• Mortgage rates drop unexpectedly, perhaps due to a shift in Federal Reserve policy.
• Inventory tightens as buyers jump back into the market.
• The economy experiences a resurgence, fueled by new industries or technologies.
• Migration to Scottsdale accelerates, driven by lifestyle factors or job opportunities.

In this more optimistic scenario, we might see:

• Home prices start to rise again, although likely not as dramatically as in the past.
• Homes sell relatively quickly, and competition among buyers increases.
• Sellers regain some negotiating power.
• New construction activity picks up to meet the renewed demand.

My Best Projections for Scottsdale

Based on the current Scottsdale housing market trends, I think Scenario 1, the “Slow and Steady” Market, is the most likely outcome. We're already seeing a shift towards more balance, and it's unlikely that we'll experience a major shock that dramatically changes the trajectory.

Here are my specific predictions:

• Home Prices: Expect modest fluctuations, with overall prices staying relatively flat or perhaps declining by a few percentage points. Some desirable neighborhoods might see slight increases.
• Inventory: Inventory will likely remain elevated compared to the peak of the seller's market, giving buyers more choices.
• Mortgage Rates: I anticipate rates to stay within a range of 6% to 6.5%.
• Days on Market: Homes will take longer to sell than they did a few years ago, so sellers need to be patient.

Should You Invest in the Scottsdale Real Estate Market?

Scottsdale, Arizona is a highly desirable location for real estate investment. With its warm climate, stunning natural scenery, vibrant nightlife, and high-quality educational institutions, Scottsdale has something to offer for everyone. The city has been ranked as one of the best places to live in the United States, and it is not hard to see why.

The Scottsdale real estate market has been thriving in recent years. There are many investment opportunities in Scottsdale, ranging from single-family homes to multifamily properties. The city has a diverse range of properties available, from luxury homes to more affordable options. One of the most promising investment opportunities in Scottsdale is in rental properties. The rental market is strong. The city has a high demand for rental properties, making it a great location to invest in rental real estate.

Another promising area for real estate investment in Scottsdale is commercial real estate. The city has a thriving economy, with a range of businesses and industries that are in need of commercial space. With a growing population and a strong economy, the demand for commercial real estate is likely to continue to grow in the coming years.

The Excellent Quality of Life

A city in a large metropolitan area is competing with every other city for residents. If the city is poorly managed or simply deteriorates, it’ll lose residents who only have to move a few miles to get away from it. In this regard, Scottsdale real estate investment is a wise choice because the city stands out in terms of quality of life. We’ll ignore the golf courses and focus instead on A-rated public schools and family-friendly amenities. They could do a little better on crime, but there are areas in Phoenix real estate market that are far worse.

Scottsdale's Job Market

Scottsdale is also an emerging tech market, with companies GoDaddy, Yelp, Paypal, Indeed.com, and Paradigm Tech all opening offices downtown. This is a great town for businesses, including small businesses and entrepreneurs. The Scottsdale job market has consistently averaged an unemployment rate a full point lower than the state average and roughly half a point lower than the Phoenix metro area average.

That alone would bolster the Scottsdale housing market. However, the relatively high property values mean much work here but live in other cities. Yet it contributes to a higher-than-expected rental rate in the Scottsdale housing market. Ironically, the high per capita income of 54K per person, twice the state average, drives up rents and housing prices.

Scottsdale's Tourist Market

Scottsdale is famous among locals for its Fashion Square Mall. However, you see more people coming here on vacation to enjoy the 200 local golf courses, many of which are world-class.

Others come to see the Major League Baseball teams in spring training in Scottsdale. Others stay in Scottsdale while watching teams practice in nearby Mesa. All of this explains why the city has the fourth-largest number of AAA four-diamond hotels in the United States. The nature of the tourist market, though, gives you the ability to rent out properties both nightly and for weeks at a time.

The Diverse Scottsdale Rental Market

The Scottsdale housing market has a more diverse rental market than just catering to those who can’t afford to buy a single-family home. For example, the area is famous for its snowbirds, retirees who come for the winter before returning home. Some of them buy a one or two-bedroom home to live in for half the year.

Others rent such properties. While many live in Sun City and other age-restricted communities, others choose to rent elsewhere in the Scottsdale real estate market.

They’ll prioritize amenities, proximity to healthcare providers, and low maintenance over cost in many cases. This population also increases the demand for RV-friendly homes and trailer parks. That provides an unusual play for those who want to profit off affordable housing in the Scottsdale housing market but don’t want to deal with Section 8 rentals.

Latest Rental Trends

Arizona is landlord-friendly compared to neighboring states like Nevada and California. What makes it notable is that it is becoming more landlord-friendly. For example, the city is passing laws that make it easier for landlords to enter units to make repairs. The state is making it easier to discard abandoned personal property and limiting appeals by those going through eviction. And it was already relatively fast and easy to evict people in Arizona.

The Scottsdale real estate investment options include the short-term rental market. The city requires short-term and vacation rentals to be registered with the county. Landlords must pay the transaction privilege sales tax and transient tax. A sales tax license is required. However, that’s simply the city saying you can rent out these units if you pay the same taxes that hotels do. The rest of the city’s regulations make the Scottsdale real estate market-friendly for renting out via sites like Airbnb.

They don’t limit short-term rentals to a tourist district. You can rent out both the main house and accessory dwelling unit on the same property. And state law doesn’t give cities the ability to apply new regulations that essentially ban short-term rentals. However, homeowners associations can regulate these types of properties, so do your research before you buy a Scottsdale real estate investment property assuming you can generate short-term rental income.

The Geographic Constraints

The Scottsdale real estate market is certain to experience appreciation for the same reason the local quality of life is so good – it is nearly surrounded by parks. The northern end of the city touches Tonto National Forest. The western edge borders McDowell Mountain Regional Park.

Homes with views and access to the national parks command a premium. Fort McDowell is a Native American reservation likewise off-limits. Tempe, Phoenix, and Mesa are all heavily developed. The city simply doesn’t have much room to expand to meet demand. This means the newest development will require redevelopment, increasing the cost of such properties and the value of existing housing stock.

At first glance, Scottsdale seems like a home buyer’s dream. It is full of suburban neighborhoods. The median household income is more than 70,000 dollars a year, and that’s pulled down by a retiree population so large that the average age is 46. However, affordability in the Scottsdale real estate market is relative.

The median wage is 73,000 but the median home price is approaching 400,000 dollars a year. This means many cannot afford to own a home though they may want to. This drives demand for rentals in the Scottsdale housing market.

It is surprisingly only a third of the residents rent, though this is somewhat higher than the 20 percent average for the area. Conversely, the high-paying jobs in the area are one reason many people move here, generating demand for rental properties by new residents.

The Relatively Low Tax Burden

Arizona has a surprisingly low property tax rate. It averages 0.85 percent of the property’s assessed value, while the national average hovers around 1.1 percent. Another benefit of Arizona real estate law is that the state limits the increases in the assessed value of property to 5 percent (or less) per year. This means your property taxes probably won’t rise at the same rate as the property value. That’s good since the Scottsdale housing market saw an appreciation of roughly five percent last year and is predicted to see at least 2 percent growth in 2019. Income taxes are competitive with the rest of the country and a bargain compared to tax-and-spend states like California, too.