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San Antonio Housing Market: Prices, Trends, Forecast 2023

March 17, 2023 by Marco Santarelli

San Antonio Housing Market

In 2023, the San Antonio housing market is expected to face new challenges amidst rising interest rates. The city, which is the second-largest in Texas, has been experiencing a hot housing market in recent years, with home values increasing steadily. However, as the Federal Reserve continues to raise interest rates to combat inflation, this could potentially impact the demand for homes in San Antonio.

Nevertheless, experts predict that the market will remain strong, with steady growth and increasing demand for homes in certain areas of the city. In this article, we'll take a closer look at the current state of the San Antonio housing market, including prices, trends, and forecasts for 2023.

San Antonio Real Estate Market Trends

According to data from the San Antonio Board of Realtors (SABOR), the San Antonio-New Braunfels MSA housing market experienced a 30% decrease in all homes sold in January 2023, with steady increases in average and median home prices compared to the previous year. However, existing and new construction homes both saw a decrease in sales compared to January 2022.

The market is also seeing an increase in the number of days a home stays on the market, with 3.2 months of inventory available. Despite this, the price per square foot has increased, and a high percentage of homes closed for their original list price. In this article, we'll dive deeper into the San Antonio housing market and what it means for buyers and sellers in 2023.

Sales Trends and Prices

The San Antonio housing market experienced a decline in sales in January 2023, with 1,311 existing homes and 431 new construction homes sold. However, the average price of an existing home has increased by 6%, now at $364,080, and the median price at $299,000, an increase of 3% from the previous year. Meanwhile, new construction homes have seen a slight increase in average prices, now at $386,645, and a 1% decrease in median prices, now at $327,250.

Days on the Market and Inventory

The market is currently seeing an increase in the number of days a home stays on the market compared to the same time last year, with a reported 66 days on the market. This is a year-over-year increase of 94%, which can be attributed to the decrease in sales. Additionally, there is currently 3.2 months of inventory available, which suggests that there is more supply than demand in the market. Despite the decrease in sales and increase in days on the market, the price per square foot has increased by 2.8% to $164. Moreover, 93.1% of homes closed for their original list price, indicating that sellers are pricing their homes accurately in the current market conditions.

Bexar County and Other Major Counties in Texas

Bexar County has seen a 35% decrease in home sales, with an average home price increase of 6.7% and a median price increase of 2.6%. The other major counties in Texas, Travis, Harris, and Dallas, have seen increases in median home prices, with reported prices of $500,000, $300,000, and $338,500, respectively.

Statewide Trends

Across the state, home sales have decreased by 28.2% from January 2022. However, median prices have increased by 2.5%, and homes are staying on the market for an average of 62 days. There are 2.7 months of inventory available, and 93% of homes closed for their original list price.

What It Means for Buyers and Sellers

With the San Antonio housing market currently favoring buyers, sellers may need to adjust their pricing strategies and expectations accordingly. Buyers may have more negotiating power in the current market conditions, but it is still crucial to act quickly and make competitive offers. Overall, both buyers and sellers should work closely with experienced real estate agents who can provide valuable insights and guidance throughout the buying or selling process.

San Antonio Housing Market Forecast 2023-2024

San Antonio's housing market has shown steady growth in the past year, with an average home value of $286,195, an increase of 6.1% from the previous year. The market is currently doing fine, with homes going to pending in just 37 days and an average sale-to-list ratio of 0.985. However, the market is expected to cool slightly over the next year, with a 0.3% 1-year market forecast.

Investors and buyers can expect to see a decrease in the percentage of sales over list price, which currently stands at 17.3%, and an increase in sales under list price, which is currently at 60.8%. Looking at the current market trends and the forecast provided by Zillow's research, it is likely that the San Antonio housing market will continue to see growth in 2023-2024.

While there may be slight fluctuations, overall home values are expected to increase, which could be good news for investors and sellers. However, buyers should be prepared for a competitive market with a relatively low inventory, as seen in the 3.2 months of inventory reported in January 2023. Homes are also staying on the market for a longer period of time compared to the previous year, indicating that buyers may have more negotiating power.

The median sale-to-list ratio of 0.985 and the percent of sales over list price at 17.3% show that sellers are still able to command a premium price for their homes, but there is still room for negotiation. Buyers should be prepared to act quickly and make competitive offers if they want to secure a home in this market.

Overall, the San Antonio housing market is expected to remain strong in 2023-2024, with continued growth in home values and a competitive market for buyers and sellers alike. Investors should consider taking advantage of this market and investing in the area while the market is still hot.

Can the market crash?

There is always a risk of a housing market crash, but it is difficult to predict with certainty. Factors such as economic conditions, interest rates, and inventory levels can all contribute to the stability of the market. The San Antonio housing market has remained relatively stable and resilient despite the challenges of the past couple of years, and it is expected to continue to grow in the near future.

While the current trends in San Antonio appear to be positive, it's impossible to predict the future with certainty. Investors and homebuyers should always do their due diligence and consider factors such as their financial situation, long-term goals, and the overall health of the local economy before making any major decisions. While there is always some level of risk involved in any investment, a well-informed and strategic approach can help mitigate potential losses and maximize returns. Ultimately, only time will tell what the future holds for the San Antonio housing market.

San Antonio Real Estate Market Forecast
Credits: Zillow.com

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.

Other Real Estate Investment Markets in Texas

Buying or selling real estate, for a majority of investors, is one of the most important decisions they will make. Choosing a real estate professional/counselor continues to be a vital part of this process. They are well-informed about critical factors that affect your specific market areas, such as changes in market conditions, market forecasts, consumer attitudes, best locations, timing, and interest rates.

NORADA REAL ESTATE INVESTMENTS has extensive experience investing in turnkey real estate and cash-flow properties. We strive to set the standard for our industry and inspire others by raising the bar on providing exceptional real estate investment opportunities in many other growth markets in the United States. We can help you succeed by minimizing risk and maximizing the profitability of your investment property in San Antonio.

Consult with one of the investment counselors who can help build you a custom portfolio of San Antonio turnkey properties. These are “Cash-Flow Rental Properties” located in some of the best neighborhoods of San Antonio.

Not just limited to San Antonio or Texas but you can also invest in some of the best real estate markets in the United States. All you have to do is fill up this form and schedule a consultation at your convenience. We’re standing by to help you take the guesswork out of real estate investing. By researching and structuring complete San Antonio turnkey real estate investments, we help you succeed by minimizing risk and maximizing profitability.

Apart from San Antonio, there are several growing real estate markets in the state of Texas. Dallas is the one that is popular among real estate investors. It is a great market because it has a strong economy and constant population growth and will make your pockets bigger. As rents go up smart investors should invest in Dallas.

Dallas’s local economy is a mix of aerospace, computer chips, telecommunications, transport, energy, and healthcare sectors and Finance and Business Services. These sectors are all providers of good wages which allows for a strong market for Dallas investment properties.

The Dallas-Fort Worth area is exploding due to its strong job market, low housing costs, and low taxes. The Fort Worth housing market presents an excellent opportunity for investors because it is cheaper than its big brother and providers a wider variety of properties. The Fort Worth real estate market has a much lower density than the Dallas real estate market.

You can find high-density housing in downtown Fort Worth, but it is far easier to find horse-friendly properties in the Fort Worth real estate market than in the distant suburbs of Dallas. This is, of course, in addition to the luxury housing markets in both cities.

Similarly, Houston is another great market for investing in real estate. Houston, TX is becoming a hotbed of buyer activity that could be beneficial for real estate investors; just ask the multitude of overseas investors who are choosing Houston as the city of choice to invest in for the foreseeable future.

The Houston metro area offers great opportunities for investors who are looking for a stable market that offers both cash flow and equity growth at a price that is STILL well below their replacement value.

With Austin, Texas, becoming a more diverse city every year, there are plenty of opportunities to take advantage of – from buying new homes to different investment options in the Austin housing market. Austin is a leader across the country with jobs and when you combine that with home prices not as drastically increasing, you’ll get a real estate market that many others envy. It may be the second most expensive housing market in the state with a median home price of around $395,000, but it is still far cheaper than California or New York. Buy up condos or townhomes, and you’ll be able to see a sizable return on the investment.

Let us know which real estate markets in the United States you consider best for real estate investing! 


Please do not make any real estate or financial decisions based solely on the information found within this article. Some of the information contained in this article was pulled from third-party sites mentioned under references. Although the information is believed to be reliable, Norada Real Estate Investments makes no representations, warranties, or guarantees, either express or implied, as to whether the information presented is accurate, reliable, or current. All information presented should be independently verified through the references given below. As a general policy, Norada Real Estate Investments makes no claims or assertions about the future housing market conditions across the US. This article aimed to educate investors who are keen to invest in San Antonio real estate. Purchasing an investment property requires a lot of study, planning, and budgeting. Not all deals are solid investments. We always recommend doing your research and taking the help of a real estate investment counselor.

References

  • https://realestate.sabor.com/
  • https://realestate.sabor.com/pages/press-releases/
  • https://www.zillow.com/sanantonio-tx/home-values
  • https://www.redfin.com/city/16657/TX/San-Antonio/housing-market
  • https://www.realtor.com/realestateandhomes-search/San-Antonio_TX/overview
  • https://www.zumper.com/rent-research/san-antonio-tx
  • https://www.rentcafe.com/average-rent-market-trends/us/tx/bexar-county/san-antonio/

Filed Under: Growth Markets, Housing Market, Real Estate Investing

Colorado Housing Market: Price, Trends, Predictions 2023

March 17, 2023 by Marco Santarelli

Colorado Housing Market

The Colorado housing market has been in a state of flux over the past few years due to the surge in demand for homes. This has led to an increase in home prices across most regions of the state, making it difficult for buyers to find their dream homes. On the other hand, it has been a seller's market, with more buyers than houses, resulting in prices being driven up.

According to the Colorado Association of Realtors, the median single-family home price in Colorado topped $500k for the first time in April of last year and has now dropped to $536,000. In February 2023, the median price in the Colorado housing market (statewide) was $536,000, down -3.4% year-over-year. This is good news for buyers who may have been priced out of the market in the past.

  • In February 2023, the median price in the Colorado housing market (statewide) was $536,000, down -3.4% year-over-year.
  • The Average Sales Price in Colorado was $663,991, down 4.4% year-over-year.
  • Percent of List Price Received has dropped to 98.5%.
  • Days on Market Until Sale = 65, up 103.1% year-over-year.
  • Closed sales of single-family homes were down by almost 19.6% from last year.
  • Months supply was up by almost 100% to 1.4 months, which is a sign that Colorado is a seller's real estate market.
  • Inventory of Active Listings increased by 59.3% year-over-year.
  • New Listings decreased by 19.6% year-over-year, which either shows a decrease in seller optimism.

The Average Sales Price in Colorado was $663,991, down 4.4% year-over-year. This drop in average sales price could be attributed to the increase in inventory of active listings, which increased by 59.3% year-over-year. More houses on the market may have resulted in a decrease in demand, leading to a drop in average sales price.

Another important metric to consider is the Percent of List Price Received, which dropped to 98.5%. This metric indicates that buyers are no longer willing to pay the asking price, and sellers may have to lower their prices to make a sale.

Days on Market Until Sale is another crucial factor to consider, and it is up by 103.1% year-over-year. This could indicate that buyers are taking longer to find the right house, or sellers are being more cautious and waiting for the right offer.

Closed sales of single-family homes were down by almost 19.6% from last year. This could be due to the increase in inventory of active listings, making buyers more selective and taking their time to find the right house.

The months supply was up by almost 100% to 1.4 months, which is a sign that Colorado is a seller's real estate market. The months supply metric is calculated by dividing the number of homes for sale by the number of homes sold in a month. A seller's market means that there are more buyers than houses for sale, and houses sell quickly.

Lastly, new listings decreased by 19.6% year-over-year, which either shows a decrease in seller optimism or a seasonal slowdown. This drop in new listings may indicate that sellers are waiting for a better time to list their homes, or there is a seasonal slowdown in the market.

In conclusion, the Colorado housing market has been a seller's market for the past few years, but the metrics indicate that it may be shifting towards a more balanced market. While home prices have increased, there has been a drop in average sales price and an increase in the inventory of active listings.

Buyers may have more options, and sellers may have to be more flexible with their prices. However, it is important to note that the real estate market is unpredictable, and these metrics can change quickly. It is crucial for buyers and sellers to stay informed and work with experienced professionals to make informed decisions.

Colorado Housing Market Predictions 2023-2024

Based on the data from the Colorado Housing Market in February 2023, it appears that the market is currently in a state of flux. While home prices have risen significantly in recent years, there are signs that the market may be cooling off. The median price of single-family homes has decreased by 3.4% year-over-year, and the average sales price has dropped by 4.4% over the same period. Additionally, the percent of list price received has dropped to 98.5%, indicating that sellers may be willing to accept lower offers.

One of the most significant changes in the market is the increase in the number of days on the market until sale. This metric has gone up by 103.1% year-over-year, suggesting that homes are taking longer to sell than they did in previous years. Another indicator of a cooling market is the decrease in closed sales of single-family homes, which were down by almost 19.6% from the previous year.

However, there are still some signs that the market remains strong for sellers. Months supply, which is a measure of the number of months it would take to sell all available homes at the current rate of sales, has increased by almost 100% to 1.4 months. This suggests that the market is still heavily tilted towards sellers, as there are not enough homes available to meet demand. Additionally, the inventory of active listings has increased by 59.3% year-over-year, indicating that there are still many homes available for sale.

Looking ahead to the rest of 2023 and into 2024, it is difficult to predict with certainty what will happen in the Colorado housing market. However, given the recent trends, it seems likely that the market will continue to cool off somewhat. Home prices may continue to decrease, and it is possible that the number of days on the market will continue to rise. At the same time, the market is still heavily tilted toward sellers, and it is likely that demand for homes will remain strong.

Based on the data provided by Zillow, we can expect a moderate increase in the Colorado housing market in 2023-2024. The average Colorado home value is currently at $530,389, up 1.8% over the past year, and homes go pending in about 29 days. Additionally, the median sale-to-list ratio for January 31, 2023, was 0.989, and 19.2% of sales were over list price, while 58.3% were under list price.

Looking at the MSA level forecast for Colorado, we can see that Denver, Boulder, and Fort Collins are expected to experience a decline in housing prices in 2023-2024, with Denver projected to decrease by 1.6% by February 2024. Other regions, such as Glenwood Springs, Steamboat Springs, and Edwards, are forecasted to experience an increase in home prices, with Edwards having the highest increase at 4.8% by February 2024.

Overall, it seems like the Colorado housing market is going to be somewhat balanced, with some regions experiencing a decrease in home values and others experiencing an increase. However, with the increase in inventory and a slight decrease in demand, buyers may have more opportunities to find homes at a more affordable price point. At the same time, sellers may need to be more flexible with their pricing strategies and be prepared to wait longer for their homes to sell.

Colorado Housing Market Predictions
Source: Zillow

Will the Colorado Housing Market Crash?

The Colorado housing market has experienced a significant surge in demand and price appreciation during the past two years, making it a challenging environment for buyers to find affordable homes. However, there are signs that the market may be slowing down, with decreased sales, increased inventory, and longer time on the market. The forecast for the next year predicts a continued slowdown in price appreciation and sales volume, but it is still expected to remain a seller's market.

One significant factor that could impact the Colorado housing market's future is the state's economy. Colorado's economy has been robust, with low unemployment rates and a thriving tech industry, attracting a large number of people to the state. However, if the economy were to take a downturn, it could lead to a decrease in demand for homes and a subsequent drop in prices. Additionally, rising interest rates could also affect the housing market, making it more expensive for buyers to obtain mortgages and leading to a decrease in demand.

While there is always a risk of a market crash, it is unlikely to happen in the current scenario. The Colorado housing market has shown resilience to economic fluctuations in the past, and its diverse economy and job growth make it less vulnerable to sudden changes. Furthermore, the state's population growth is expected to continue, which will keep the demand for homes high.

In conclusion, the Colorado housing market has been a challenging environment for buyers in recent years, with high prices and limited inventory. While the market may be slowing down, it is still a seller's market, and prices are expected to continue appreciating, albeit at a slower pace.

Factors such as the state's robust economy and population growth suggest that the housing market is unlikely to crash in the current scenario, but rising interest rates could lead to a decrease in demand and a subsequent drop in prices. Therefore, it is essential to keep an eye on economic indicators and market trends while making any real estate decisions in Colorado.


References:

  • https://www.zillow.com/co/home-values/
  • https://www.recolorado.com/buy-sell/market-trends/
  • https://fred.stlouisfed.org/series/ACTLISCOUCO#
  • https://coloradorealtors.com/market-trends/regional-and-statewide-statistics/

Filed Under: Growth Markets, Housing Market Tagged With: colorado housing market, colorado real estate market, Housing Market Forecast, housing market predictions

Utah Housing Market (Salt Lake City) Trends & Forecast 2023

March 17, 2023 by Marco Santarelli

Utah Housing Market

The Utah Housing Market is Slowing Down

It is a seller’s market in Utah as the housing supply can't satisfy demand, which will drive prices to increase further even in the face of rising mortgage rates. The rapid appreciation witnessed over the past two years may have begun to decelerate as a result of rising financing costs and deteriorating affordability.

This is nothing to worry about; rather, it indicates that the market is beginning to return to normalcy. The same can be said about the Salt Lake County real estate market. The market is still highly competitive. Even while inventory is rising considerably compared to the previous two years, this does not solve a problem that has existed in Utah for years. There are still insufficient homes.

A recent report on the forecasts for Utah's housing market in 2023 was given by Jim Wood, a housing economist at the University of Utah's Kem C. Gardner Policy Institute, and Lawrence Yun, chief economist and senior vice president for research at the National Association of Realtors projects that 2023 will be a challenging year for the housing market, with interest rate hikes, falling home sales, and dropping home prices.

However, a housing bubble is considered “extremely unlikely.” Future mortgage rates are projected to vary anywhere from 5% to 9% by the end of 2023, with the prevailing sentiment landing in the 6.5% to 7.5% range. Home sales in the five-county area centered on Salt Lake City will be sharply down for 2023 and for the country as a whole. Although Utah will not see a recession, job gains are expected to slow down. Employment in the state remains strong, with a jobless rate of 2.2%, the lowest in the nation.

Utah is facing a dire shortage of affordable homes for sale and for rent, which is likely to be among the dominant issues of the 2023 Utah Legislature. The report also shows that home builders in Utah have pulled back significantly on their hectic pace of housing starts and new development. Meanwhile, renters may see some relief in 2023 as a wave of newly constructed apartments comes online.

Utah Housing Market Trends Q4 2022

According to the report by Windermere Real Estate Chief Economist Matthew Gardner, the Utah real estate market has experienced a slowdown in the pace of job growth, with the state adding 43,300 jobs over the past 12 months at an annual rate of 2.6%. The state's unemployment rate stood at 2.2% in November 2022, marginally below the prior year's rate.

In the fourth quarter of 2022, the number of homes sold in the areas covered by the report fell by 45% compared to the same period the previous year and by 27.8% compared to the third quarter of 2022. Sales fell across the board compared to both the fourth quarter of 2021 and the third quarter of 2022. Significantly higher inventory levels gave buyers more options, which likely impacted sales in the fourth quarter.

The average sale price in the fourth quarter of 2022 rose 0.6% from the fourth quarter of 2021 to $604,105. Median listing prices were 3.6% lower than in the third quarter of 2022, suggesting that higher financing costs may have created a price ceiling. Year over year, prices rose in four markets but pulled back in the other three. Compared to the third quarter of 2022, average home prices fell in every area other than Summit County, where they rose 0.8%.

Mortgage rates rose dramatically in 2022 but are expected to trend lower as we move through the year. However, rates will still be higher than what homebuyers have become accustomed to. The average time it took to sell a home in the counties covered by the report rose 27 days compared to the same period in 2021.

Utah Housing Market Report

The Utah real estate market saw mixed trends in 2022, according to the data provided by the Utah Association of REALTORS®. While some counties experienced increases in the number of homes sold and the median sale price, others saw declines in both categories. Overall, the state saw a 44.9% drop in home sales volume between December 2021 and December 2022, with 2,644 homes sold in 2022 compared to 4,798 in 2021.

However, the year-to-date (YTD) sales volume for 2022 only decreased by 20.6% compared to 2021, with 44,602 homes sold in 2022. The median home price increased from $475,000 in 12-2021 to $476,824 in 12-2022, a 0.4% increase. Year-to-date median home price increased by 15.1% from $443,036 in 2021 to $510,000 in 2022.

Here are the key takeaways from the data:

  • Number of homes sold: The number of homes sold in Utah decreased in 2022 compared to 2021 YTD. Salt Lake County saw the biggest decline, with a drop of 26.1%, while Box Elder County saw a decrease of 16.9%. However, there were some counties that saw increases in the number of homes sold. Piute County saw a 100% decrease, meaning no homes were sold in 2022, whereas Rich County saw a significant increase of 7.4%.
  • Median sale price: The median sale price of homes in Utah also varied by county. While some counties, such as Cache and Davis, saw minor increases in the median sale price, others experienced significant drops, such as Daggett County, which had a 58% decline. Meanwhile, some counties saw significant increases in the median sale price, including Grand County with a 30.5% increase.
  • Overall trend: Utah's real estate market experienced mixed trends in 2022. Although the number of homes sold decreased, the median sale price increased in some counties, indicating that the market is still strong in certain areas. The pandemic has impacted the real estate market in various ways, leading to changes in the number of homes sold and the median sale price.

Looking at the median home prices for Utah, we can see that there are some variations across the different counties. In general, we can see that the median home price increased from 2021 to 2022, with most counties experiencing a rise. Some counties had particularly significant increases, such as Piute County, which saw a 32.6% rise, Duchesne County, which saw a 44% increase, and Rich County, which saw a 36.7% increase.

Other counties saw more modest increases, such as Salt Lake County, which saw a 14.8% increase, and Summit County, which saw a 13% increase. However, there were a few counties where the median home price decreased from 2021 to 2022, such as Beaver County, where it decreased by 5.7%, and Iron County, where it decreased by 11.4%.

When we look at year-to-date median home prices for 2021 and 2022, we can see that most counties also experienced an increase in median home prices. The highest increases were seen in Piute County (where there was a 32.6% increase), Duchesne County (where there was a 44% increase), and Garfield County (where there was a 38% increase).

Hence, we can say that the real estate market in Utah has seen mixed trends in 2022, with some counties experiencing increases in the median sale price and others seeing decreases. The number of homes sold also decreased in most counties. However, despite the fluctuations, the market remains strong in some counties, and it will be interesting to see how these trends develop in the future.

Why is Utah's Housing Market So Hot?

Rapid population growth and job growth are the two most important drivers of housing demand in Utah right now. According to local real estate agents, there aren’t enough single-family homes to meet the rising housing demand. A balanced market has roughly a six-month supply of houses, which means that if we stopped listing new properties, we'd still have about six months before we ran out. And right now, Utah is down to about four weeks of supply of homes.

As a result, finding a dream house in this market is challenging for buyers, making it extremely competitive. Utah's employment landscape is also one of the most impressive in the country. It has had the most rapidly growing job market in the country for the past decade. Utah's population grew by 18.4% over the past decade, making it the fastest-growing state. It's now the 30th most populated state, with nearly 3.28 million people, according to U.S. Census Bureau data.

A large number of Californians are relocating to Utah, putting extra pressure on the supply side. In-migration to the Salt Lake metropolitan area is still at an all-time high. The issue is that demand is so strong that inventory can't reach a level that indicates a sufficient supply. People are also coming from New York, Boston, Vermont, Austin, Texas, and other cities, according to local real estate agents. They also think that people who are first-time homebuyers in Utah will be priced out of the market by people moving in from other states.

Utah Real Estate Market Report For Nov 2022

Here's how the housing market performed, according to UtahRealEstate.com. Utah’s median home price remains well over the half-a-million-dollar mark. Compare that to January 2019, when it was just below $300,000.

  • In November 2022, around 2333 homes were sold on MLS, down 44.3% from last year.
  • No. of single-family homes sold was 1798.
  • No. of multi-family homes sold was 535.
  • The median days on market were 39, up from 36 days last month.
  • The median selling price was $525,000 for single-family homes, up 1.9% year-over-year.
  • The median selling price was $396,000 for multi-family homes, up 2.9% year-over-year.
  • The data is provided by UtahRealEstate.com, the leading provider of real estate technology in Utah and one of the largest Multiple Listing Services in the United States.
Utah Housing Market Trends
Source: UtahRealEstate.com

Why Are Home Prices So High in Utah?

Utah boasts the nation’s strongest pace of job growth, along with rock-bottom unemployment, ultra-low mortgage rates, few mortgage delinquencies, and low state and local taxes. All those factors pushed Utah into first place in Bankrate’s Housing Heat Index for the fourth quarter of 2020. Utah's home values increased by 15.39% in the 12-month period that ended Dec. 31, third-best among U.S. states, according to the Federal Housing Finance Agency.

Since 1991 Q1, HPI for Utah has increased by 414.95%. Idaho ranked #1 in FHFA State House Price Indexes. The HPI is a broad measure of the movement of single-family house prices. It is measured by reviewing mortgage transactions on single-family properties whose mortgages have been purchased or securitized by Fannie Mae or Freddie Mac. According to a Bankrate analysis of Labor Department data, Utah also posted the second-strongest job growth in the nation from December 2019 to December 2020.

Even if inventory is significantly higher than it has been in the previous two years, it still does not address what has been a problem in Utah for years. There are still not enough houses. Even though homebuilding soared in Utah in 2021, putting the state on the national map for its housing boom. It made a decent dent in Utah’s housing shortage, but not enough to erase it.

Utah Housing Market Forecast 2023

Utah's housing market has boomed during the pandemic, and Utah has emerged as a particularly desirable market. Utah home prices are soaring as Californians migrate into the state leading to an imbalance between supply and demand. Utah's economy is currently in excellent shape. Utah's job market is robust enough to avoid widespread foreclosures, and housing demand is expected to remain high in 2023 due to the state's rapid expansion and widespread home shortage.

Some experts expect prices to decline in 2023, depending on what happens with interest rates in 2023. So far, Utah home prices are still up year over year. Higher mortgages have already impacted buyer demand. Sales have been declining by massive double-digits. The price growth is trending lower, and 2023 can't be a year of double-digit increase.

Since the last twelve months, Utah housing prices have gone up by nearly 2.8% — Zillow Home Value Index. ZHVI represents the whole housing stock and not just the homes that list or sell in a given month. The typical home value of homes in Utah is currently $500,077.

It indicates that 50 percent of all housing stock in the area is worth more than $500,077 and 50 percent is worth less (adjusting for seasonal fluctuations). Based on the data provided by Zillow, here is a forecast for the Utah housing market. Overall, the Utah housing market is expected to continue growing steadily in the coming years, with most areas experiencing positive price growth through 2024.

Salt Lake City: While there may be some slight dips and gains over the next year, overall, the housing market in Salt Lake City is expected to remain relatively stable, with modest gains of up to 1.2% by January 2024.

Ogden: The housing market in Ogden may experience some slight declines over the next year, with decreases of up to 0.5%, followed by a rebound with a 1% increase by January 2024.

Provo: Similar to Ogden, Provo may experience some slight declines over the next year, with decreases of up to 0.4%, followed by a modest recovery with a 0.4% increase by January 2024.

St. George: Despite some minor fluctuations, St. George is expected to continue to experience positive price growth, with gains of up to 0.9% by January 2024.

Logan: Like Provo and Ogden, Logan may experience some slight declines over the next year, with decreases of up to 0.4%, but is expected to rebound with a more significant increase of up to 1.7% by January 2024.

Heber: The housing market in Heber is expected to remain relatively stable, with modest gains of up to 2.2% by January 2024.

Cedar City: While there may be some slight declines over the next year, Cedar City is expected to experience steady growth overall, with gains of up to 2.1% by January 2024.

Vernal: Vernal is expected to experience steady growth in the coming years, with gains of up to 1.7% by January 2024.

Price: Price is expected to experience significant price growth over the next year, with gains of up to 1.7% by April 2023, followed by an even more substantial increase of up to 4.5% by January 2024.

It's important to note that these forecasts are based on historical data and trends, and many factors can impact the Utah housing market, including changes in the economy, interest rates, and demographics. Therefore, these forecasts should be taken as a general indication and not a guarantee.

Utah housing price forecast
Credits: Zillow

Here's the current overview of Utah's Listing prices by “Counties” (source: Realtor.com)

A list price in real estate is the price of a house for sale determined by the seller and her listing agent. The listing price determines how long it takes to locate a buyer (i.e., Time On the Market = TOM), and TOM influences the price that comes from seller-buyer bargaining. Although paying 1 to 3 percent over the list price is not unusual, you should ask your realtor to come up with a price that is best for you.

Counties Median Asking Price $/SqFt
Salt Lake County
$530K
$254
Utah County
$525K
$217
Davis County
$525K
$216
Weber County
$420K
$216
Washington County
$575K
$285
Cache County
$460K
$204
Summit County
$1.6M
$780
Iron County
$405K
$211
Wasatch County
$1.1M
$422
Tooele County
$470K
$187
Box Elder County
$449.3K
$193
Uintah County
$304.9K
$155

Salt Lake City Housing Market Forecast 2023

The Salt Lake City real estate market has been one of Millennials' toughest real estate markets due to limited supply relative to demand. It has become one of the top markets to watch in 2023. According to the most recent Salt Lake County house sales data, it seems that Utah's housing market may be slowing ever so little in the near future. More houses were sold in 2020 than in any prior year, putting 2021 on pace to be the second-highest sales year ever. With 19,202 homes sold in Salt Lake County, 2021 saw another record-breaking price rise, and it is expected to continue this year as well.

In 2021, the median price of homes sold in Salt Lake County increased by 22% from $378,250 in 2020. According to the Salt Lake Board of Realtors, the median price of single-family houses sold in 2021 surpassed the half-million barrier, reaching $533,000, a remarkable 25% increase over the $425,000 median price in 2020. In December, prices were up 24%, just slightly below the largest gain of 27% in June and there’s no sign yet of a slowdown. The board predicts home prices will continue to climb between 10-12% in 2022.

Salt Lake City is a moderately walkable city with a population of approximately 186,419 people. While the city limits encompass 110 square miles, downtown runs nearly two miles from east to west and nearly two miles north to south. Salt Lake City's population is also very young. The largest percentage of the city's population falls in the 25 to 39-year-old age group.

Couple that with a high school graduation rate, and a large number of college graduates and you have an attractive workforce for many large companies. The state of Utah's population grew 9 percent over the last five years, much of it concentrated in Salt Lake City, where the typical home price at the end of 2021 was $583,858 (ZHVI Dec 2021).

The Salt Lake City area's economy is doing well, and it has one of the lowest unemployment rates in the U.S. Utah’s employment outlook during the pandemic continued to outperform the rest of the country. Utah’s nonfarm payroll employment for December 2021 increased an estimated 3.7% across the past 24 months, with the state’s economy adding a cumulative 59,200 jobs since December 2019.

Utah’s current employment level stands at 1,646,900. December’s seasonally-adjusted unemployment rate is estimated at 1.9%, with approximately 31,800 Utahns unemployed. Utah’s November unemployment rate is unchanged at 2.1%. The December national unemployment rate continued to decline, registering 3.9%.

Utah’s economy progressed through 2021. The strength of the overall economy significantly impacts the real estate market as buyers' ability to support housing prices largely depends on key economic factors. The state’s economy has proved to be “one of the nation’s best in reemploying workers” as officials continued to actively encourage those drawing unemployment benefits to seek work in sectors less damaged by the pandemic.

Long-term demographic and economic growth has generated rapid increases in housing prices in Salt Lake County. The median sales price of a single-family home in the county has increased from $378,500 in 2020 to $460,000 in 2021, an average annual growth rate of 21.5%. 2020's annual growth rate was 11.8%. Since 1996, housing prices in Salt Lake County have increased at an average annual rate of 5.1%. Affordability issues may impact rapid price increases in 2022, but we may still see another year of a double-digit increase.

Let us look at the price trends recorded by Zillow over the past few years. Salt Lake City has a track record of being one of the best long-term real estate investments in the U.S. The typical home value of homes in Salt Lake County is currently $529,852, +2.7% from last year (12-month Value Change).

According to NeighborhoodScout’s data, Salt Lake City real estate appreciated 161.55% over the last ten years, which is an average annual home appreciation rate of 10.09%, putting Salt Lake City in the top 10% nationally for real estate appreciation. Salt Lake City's appreciation rates in the last twelve months (2021 Q2 – 2022 Q2) continue to be some of the highest in the nation, at 15.48%. In the latest quarter tracked by them (2022 Q1 – 2022 Q2) Salt Lake City appreciation rates were at 4.02%, which equates to an annual appreciation rate of 17.06%.

In the Salt Lake City metropolitan area, the typical value of homes is $523,590. Salt Lake City Metro home values have gone up 2.5% over the last twelve months year and Zillow predicts they may rise 1.2% from January 2023 to January 2024.

  • Typical Home Values: $523,590

  • 1-year Value Change: +2.5%

  • 1-year Value Forecast: +1.2%

  • (Data through January 31, 2023)

Salt Lake City Housing Market Forecast
Courtesy of Zillow.com

Salt Lake City Real Estate Investment Overview

Now that you know where Salt Lake City is, you probably want to know why we’re recommending it to real estate investors. Is Salt Lake City a Good Place For Real Estate Investment? You need to drill deeper into local trends if you want to know what the market holds for real estate investors and buyers in 2023.

If you are looking to make a profit, you don’t want to buy the most expensive property in the Salt Lake City real estate market and expect to make a good profit on rents. Perhaps you are looking for a slightly different hold-over, an investment property in Salt Lake City that you might move into or sell at retirement in the future. Either way, knowing your profit potential and purpose is the first thing to consider.

Salt Lake City is the largest city in the state of Utah, though it tends to be overlooked by real estate investors as just another part of a “flyover” country. Nearly half of all jobs in the state and 40% of the state’s population are located in Salt Lake County. The city is the core of the Salt Lake City metropolitan area, which has a population of roughly 1.2 million. Today, Salt Lake City is a major tourist spot in the U.S. The city is also the national hub of industrial banking.

People are moving there due to the lower cost of housing, good quality of life, and outdoor recreation. The economy is strong and the city has one of the lowest unemployment rates in the nation.  A strong job market and a robust economy have been contributing to the rising housing costs over the past several years. Utah is the only state since 1900 where the homeownership rate has never fallen below 60%

The 2021 Utah housing market will be long remembered for its record-breaking price increases. Statewide, housing prices increased by 27%, shattering the 43-year-old record of 20.1% set in 1978, according to the Salt Lake Board of Realtors. Record price increases were not confined to Wasatch Front counties; nearly every county in the state saw record increases. Twenty-four of Utah’s 29 counties had double-digit gains.

Forecast for 2022: High prices, projected interest rate rises, listing shortages, and slower employment growth will keep Salt Lake County sales at approximately 17,000 units in 2022, according to the Salt Lake Board of Realtors. Mortgage interest rates are projected to climb, but only a little. Based on the estimates of seven organizations, the average rate for 2022 is 3.55 percent.

The pricing momentum will weaken, but another year of double-digit increases is possible; expect a 10% to 12% increase, resulting in an additional $50 million in commissions. Finally, there are two sides to the pricing coin: present homeowners will profit from high price increases again, but future generations will be less likely to own a home, resulting in more inequality and lower wealth for these households.

So what makes Salt Lake City Downtown so appealing to home buyers and investors? Downtown is the oldest district in Salt Lake City, Utah. The grid from which the entire city is laid out originates at Temple Square, the location of the Salt Lake Temple. Downtown Salt Lake City encompasses the areas of Temple Square, The Gateway, Main Street, the central business district, South Temple, and others.

Throughout the last decade, Salt Lake City has seen a significant increase in development, from City Creek Center to 111 Main, these and other developments have played a crucial role in improving the vibrancy of downtown. Like the rest of the state, Salt Lake City Downtown is benefiting from the region’s healthy economy.

More people live and work in the downtown area than ever before. But according to local real estate experts and representatives from the Downtown Alliance, despite the boom, the supply in downtown Salt Lake City isn’t catching up to the demand, and more development is needed in the city’s central business district to accommodate the growing demand for housing and office space.

The Urban Land Institute ranked it the nation’s third-best market for commercial development in its 2018 Emerging Trends report, fueled in part by the big names relocating here like Goldman Sachs, which now has the fourth-largest office in the world in Salt Lake City. Salt Lake City's housing market is booming because of an ideal combination of business growth triggering in-migration and strong native population growth.

And with a variety of affordable homes in high-quality neighborhoods, it is a market that is not yet closed to first-time home buyers. Is Salt Lake City going to be a sizzling real estate market for investors in 2021? Looking at the positive forecast, the annual appreciation rate is predicted to be between 10% to 12%.

You can either choose to invest in your future or market your home to potential buyers. If you are looking for an affordable real estate market with a high potential for return on investment, you should consider Salt Lake City in 2021. Let’s take a look at the number of positive things going on in the Salt Lake City real estate market which can help investors who are keen to buy an investment property in this city.

Positive Demographic Trends

The total fertility rate for the United States hovers between 1.8 and 2.1 depending on the source you want to believe. Mormons, the majority of the population in Salt Lake City and Utah as a whole, have an average of 3.4 children. This puts constant pressure on the Salt Lake City real estate market. It also makes the Salt Lake City housing market unusual in the demand for homes with multiple bedrooms suitable for large families. There is a niche in the Salt Lake City real estate market for large luxury homes, but it is notable for the sheer demand for 4 or more bedrooms in affordable neighborhoods.

Near Certain Real Estate Appreciation

Salt Lake City sits at the intersection of I-80 and I-15. The industry tends to spread out along the highways, and housing follows. Investors in the Salt Lake City real estate market can buy land to develop or invest in housing projects being built in expectation of workers who will soon move to the area. Demand is one factor in the equation that determines the price of housing. The other is supply.

Salt Lake City has seen an increase in housing construction since the economy rebounded. However, geography limits how and where homes can be built. This is causing home prices to appreciate significantly, and there is no evidence Salt Lake City could over-build the way Phoenix did before the Great Recession. A subtle issue hitting Utah is the relative shortage of skilled building trade talent despite the influx of people coming to work in business and tech.

Salt Lake City Market Is Everything Which California Isn’t

California is experiencing an incredible divergence from its ideals. While there is still a red-hot housing market in Silicon Valley, the state also has the highest poverty levels in the nation. They’re chasing businesses out of the state through oppressive regulation and high taxes. In contrast, Salt Lake City is booming because it is business-friendly.

So many California tech firms have relocated to Salt Lake City that the area is now nicknamed “Silicon Slopes”. Forbes listed Salt Lake City first on its list of “next tech meccas”. The city is already home to many new startups. Where there are currently good-paying jobs, new residents are sure to move in. And that only puts more pressure on the Salt Lake City housing market. The very low crime rate in Utah compared to surrounding states is merely a bonus.

The Low Cost of Living in Salt Lake City

Housing aside, another reason why people relocate from the West Coast to Utah is the low cost of living. In fact, the $400,000 house in Utah with four bedrooms and a yard looks cheap when you sold a two-bedroom condo for 50% more than that in California. The overall cost of living in Utah is cheaper than the nation overall, and it is far cheaper than California, so many choose to relocate here from the high-cost states on the coast.

The Growing Salt Lake City Rental Market

The Salt Lake City housing market can’t keep up with demand, and this is pushing many Millennials and new residents into the rental market. While many would like to own a home, affordability is an issue for the young would-be homeowner; the average Millennial earns $68,000 a year while the median home price is $400,000. This explains why Salt Lake City has some of the fastest-growing rents in the country.

As of January 01, 2022, the average rent for a 1-bedroom apartment in Salt Lake City is currently $1,375. This is a 15% increase compared to the previous year. Over the past month, the average rent for a studio apartment in Salt Lake City decreased by -7% to $1,125. The average rent for a 1-bedroom apartment decreased by -7% to $1,375, and the average rent for a 2-bedroom apartment decreased by -1% to $1,633.

  • Two-bedroom apartment rents average $1,633 (an 11% increase from last year).
  • Three-bedroom apartment rents average $2,150 (an 8% increase from last year).
  • Four-bedroom apartment rents average $2,723 (an 11% increase from last year).

The Zumper Salt Lake City Metro Area Report analyzed active listings last month across the metro cities to show the most and least expensive cities and cities with the fastest growing rents. The Utah one bedroom median rent was $1,291 last month. Draper was the most expensive city with one-bedrooms priced at $1,500 while Cedar City ranked as the most affordable city with one-bedrooms priced at $520.

The Fastest Growing Cities For Rents in the Salt Lake City Metro Area (Y/Y%)

  • South Salt Lake had the fastest growing rent, up 20.2% since this time last year.
  • Millcreek rent jumped 16.4%, making it second.
  • Ogden was third with rent climbing 15.7%.

The Fastest Growing Cities For Rents in the Salt Lake City Metro Area (M/M%)

  • South Salt Lake rent had the largest monthly growth rate, up 5%.
  • Ogden was second with rent climbing 4%.
  • Salt Lake City saw rent increase 3.8%, making it third.
Salt Lake City Metro Area Rent Report
Source: Zumper

Landlord Friendliness

Salt Lake City requires landlords to get a business license, even if they own one rental home. The fees that you are required to pay as part of the rental program depend on how well-maintained the units are. However, Salt Lake City in general is very landlord-friendly. Eviction for nonpayment of rent can get someone out in two to four weeks. Courts regularly side with landlords and award triple fees for damages by a tenant. If someone violates the terms of the lease, they have three days to correct the situation. You can end a month-to-month tenancy with 15 days of notice.

Multiple Luxury Markets

Downtown Salt Lake City properties near the Mormon Temple command a premium, but that isn’t the only upscale market in the area. Park City and the northern side of Oakley have properties that cost on average well over a million dollars. As you move up Highway 80 toward Hoytsville and Wanship, properties routinely cost more than a million dollars despite the hour commute to Salt Lake City.

Looking For Salt Lake City Investment Properties?

Buying or selling real estate, for a majority of investors, is one of the most important decisions they will make. Choosing a real estate professional/counselor continues to be a vital part of this process. They are well-informed about critical factors that affect your specific market areas, such as changes in market conditions, market forecasts, consumer attitudes, best locations, timing, and interest rates.

NORADA REAL ESTATE INVESTMENTS has extensive experience investing in turnkey real estate and cash-flow properties. We strive to set the standard for our industry and inspire others by raising the bar on providing exceptional real estate investment opportunities in many other growth markets in the United States. We can help you succeed by minimizing risk and maximizing the profitability of your investment property in Salt Lake City.

Consult with one of the investment counselors who can help build you a custom portfolio of Salt Lake City turnkey properties. These are “Cash-Flow Rental Properties” located in some of the best neighborhoods of Salt Lake City.

Not just limited to Salt Lake City or Utah but you can also invest in some of the best real estate markets in the United States. All you have to do is fill up this form and schedule a consultation at your convenience. We’re standing by to help you take the guesswork out of real estate investing. By researching and structuring complete Salt Lake City turnkey real estate investments, we help you succeed by minimizing risk and maximizing profitability.

Like the Salt Lake City real estate market, the other housing market to go for to diversify your investments is the Baltimore real estate market. The Baltimore real estate market has been in decline for years, but several spots offer significant returns. And there are signs that the city is starting to turn around.

The Baltimore real estate market around the new industrial parks built to cater to Amazon will boom because we can expect as many jobs from Amazon’s suppliers in those areas as Amazon itself – and those workers will want to live close to work. The Baltimore real estate market is promising and shows a new increase of opportunities for both buyers and sellers.

Similarly, Cincinnati, OH is another great market to get started in real estate investing. Cincinnati's real estate market is on the upswing and looking strong for the foreseeable future. It provides many opportunities to investors, regardless of the market you want to invest in.

Let us know which real estate markets in the United States you consider best for real estate investing! 


Remember, caveat emptor still applies when buying a property anywhere. Some of the information contained in this article was pulled from third-party sites mentioned under references. Although the information is believed to be reliable, Norada Real Estate Investments makes no representations, warranties, or guarantees, either express or implied, as to whether the information presented is accurate, reliable, or current. All information presented should be independently verified through the references given below. As a general policy, Norada Real Estate Investments makes no claims or assertions about the future housing market conditions across the US. 

References

  • https://slrealtors.com/
  • https://utahrealtors.com/
  • https://www.zillow.com/salt-lake-city-ut/home-values/
  • https://www.zillow.com/salt-lake-city-metro-ut_r395053/home-values/
  • https://www.bankrate.com/mortgages/housing-heat-index/
  • https://www.fhfa.gov/DataTools/Tools/Pages/House-Price-Index-(HPI).aspx
  • https://www.fhfa.gov/DataTools/Tools/Pages/FHFA-HPI-Top-100-Metro-Area-Rankings.aspx
  • https://slrealtors.com/wp-content/uploads/2021/01/2021-Housing-Forecast-Report.pdf
  • https://www.realtor.com/realestateandhomes-search/Utah/overview
  • https://www.sltrib.com/news/2021/06/24/hyper-hyper-competitive/
  • https://www.zumper.com/rent-research/salt-lake-city-ut
  • https://www.realtytrac.com/statsandtrends/foreclosuretrends/ut/salt-lake-county/salt-lake-city/
  • https://www.ksl.com/?sid=46284050&nid=1426https://www.buildium.com/laws/utah-evictions-process/
  • https://en.wikipedia.org/wiki/Salt_Lake_City
  • https://www.deseret.com/utah/2021/9/16/22677951/utah-homes-sales-are-slowing-but-the-market-is-still-red-hot-salt-lake-county-city-housing-prices
  • http://www.cbre.us/people-and-offices/corporate-offices/salt-lake-city/salt-lake-city-media-center/cbre-releases-2018-salt-lake-city-real-estate-market-outlook

Filed Under: Growth Markets, Housing Market, Real Estate Investing

Phoenix Housing Market: Prices, Trends, Forecast 2023

March 17, 2023 by Marco Santarelli

Phoenix Housing Market

Will The Phoenix Housing Market Crash?

Phoenix has been one of the hottest real estate markets in the U.S. The Greater Phoenix housing market was extremely strong in the two years of this pandemic. The evidence from various sources suggests that home prices in Phoenix are expected to decline in 2023, with some projections seeing this price decline as high as 3% in some Arizona housing markets to the median home value.

Phoenix's housing market is now cooling off, which is excellent news for buyers but not for homeowners. According to the Census Bureau, home sales are down almost 18% since January 2022. However, some areas have cooled more than others. To uncover where housing markets are cooling off most, SmartAsset analyzed the 100 largest metro areas, 92 of which had complete data.

Phoenix-Mesa-Chandler, Arizona ranks No. 3 overall. The metro area has the fifth-highest percentage of house listings with a price cut (39.61%), which is 25% points higher than a year ago. Additionally, the number of houses sold in a month has declined by more than 41% between August 2021 and August 2022.

According to Zillow's home value index, typical property values in Phoenix-Mesa-Scottsdale Metro grew by 3.6% over the last twelve months. The latest forecast is that Phoenix-Area home prices are projected to decline by 1.2% between January 2023 to January 2024. According to the most current S&P CoreLogic Case-Shiller Index, Phoenix’s rapidly slowing housing market has pulled the metro down to the 11th position with a 6.3% increase — down from its peak gain of 32.9% in February 2022.

Another report obtained by Arizona's Family predicts that the Phoenix housing market could see a price drop of up to 25% in 2023 and 2024, similar to the 2008 Great Recession. The same report suggests that Arizona could be one of the states to experience the most significant drop in housing prices in the West.

Phoenix Real Estate Market Report For January 2023

Phoenix Metro Area: According to the Arizona Regional Multiple Listing Service, the Phoenix housing market experienced low sales volume in January due to high mortgage rates. There were only 4,265 home sales reported by ARMLS, which is the second-lowest sales total for January in the last 20 years. This represents a decline of 37.3% year over year. The median sales price also decreased by 5.7% year over year but only by 0.5% month over month.

However, there is some good news on the horizon. Mortgage rates have since fallen nearly a full point from their peak in November 2022. This reduction in rates could allow as many as three million more mortgage-ready consumers to qualify and afford a $400,000 loan. As a result, buyers have more enthusiasm for the housing market than they did in December, and the market is expected to recover nicely in the spring buying season.

The median-priced home, as reported by ARMLS, sold for $410,000 in January. While the Phoenix housing market experienced low sales volume and a decline in median sales price in January, the reduction in mortgage rates could result in more homebuyers entering the market in the upcoming months, leading to a recovery in the market.

Based on the ARMLS Pending Price Index, the median sales price in Phoenix is projected to rise slightly to $415,000 in February 2023, which is a 1.22% increase month over month, but a 7.74% decline year over year. According to the report, if these projections are accurate, the median sales price will be 12.63% lower than May 2022's record high of $475,000. In February 2023, there were 5,231 pending contracts, which is 24.26% lower than last year, and 8,134 residential listings under contract, including 2,571 UCB listings and 332 CCBS.

While sales volumes have been below normal, they have been recovering steadily and promise better times when the Spring buying season gets fully underway, as per Michael Orr of the Cromford Report. The report predicts a modest increase in prices but a drop in sales volume year over year. However, with mortgage rates falling nearly a full point from their peak, Freddie Mac research suggests that this reduction in rates could enable as many as three million more mortgage-ready consumers to qualify and afford a $400,000 loan, which may bring new buyers into the market.

Are House Prices Going Down in Phoenix?

According to the most recent data by Phoenix Realtors, Phoenix home sales are down 46.4% compared to last November while the housing supply has jumped by almost 200%.

  • The average price of single-family homes in Phoenix has decreased by 5.4% from a year ago to $523,165.
  • The median home price in Phoenix has dropped by 6.1% from a year ago to $422,500.
  • In January last year, the median home price was $450,000.
  • Total single-family homes sold in January dropped by 46.4%.
  • The number of new listings homes for sale has decreased by about 41.8% year-over-year.
  • Months Supply of Inventory increased from 0.7 months to 2.2 months (+ 214.3%).

According to Redfin, the Phoenix housing market is somewhat competitive. The average homes sell for about 3% below the list price and go under contract in around 64 days. Hot listings on the market can sell for around the list price and go pending in just 30 days.

  • In January 2023, Phoenix home prices were down 4.8% compared to last year, selling for a median price of $404K.
  • On average, homes in Phoenix sell after 70 days on the market compared to 32 days last year.
  • There were 1,041 homes sold in January this year, down from 1,842 last year.
  • 11% of homes were sold above their original asking prices, which is 34.2% less when compared to last year.
  • About 41.2% of the listed homes were sold with price drops.
  • The sale-to-list-price ratio was 96.7%,
  • If it's less than 100%, the home sold for less than the list price.

Phoenix (Maricopa County) Home values

The following housing market median prices are based on all properties listed for sale on realtor.com. Land and multi-unit residences included. This data is provided as an informational resource only. Phoenix is the seat of Maricopa County and the largest city in the state.

In January 2023, the median listing price for a property in Maricopa County, Arizona was $485.3K, representing an annual increase of 0%. The median asking price per square foot for homes was $270. The median price of a property sold was $435K. It is a balanced market with a Sale-to-List Price Ratio of 97.92%. The supply and demand of homes are about the same, and it's what we see in most housing markets today.

  • Paradise Valley has a median listing price of $4.2M, making it the most expensive city in Maricopa County.
  • Sun City is the most affordable city, with a median listing price of $299.9K.
  • Phoenix City has a median listing price of $450K, trending up 1.1% year-over-year.
  • The median home sold price in Phoenix is $400K.
  • Arcadia has a median listing price of $1.3M, making it the most expensive neighborhood in Phoenix.
  • Central City South is the most affordable neighborhood in Phoenix, with a median listing price of $305.5K.

The pandemic could only pause sales, which in turn created a huge pent-up demand. As we saw the Arizona housing market thriving & becoming sizzling hot in the past couple of years, even the rise in mortgage rates was believed not to affect it. High demand and low inventory have increased prices. As per the current trends, Phoenix is predicted to remain a balanced market in the next 12 months.

The prediction is that the downward price trend will continue with a moderate pace (single-digit appreciation) for the near and medium term, but there won't be any major price crashes. Intriguingly, mortgage industry members remain hopeful that interest rates will decline in 2023. The question is whether the market is too optimistic or has a better understanding of inflation and the potential impact of a recession than the Federal Reserve. Regarding the local Phoenix housing market, experts see prices going down in 2023. The latest forecast by Zillow shows a price delicate of 1.2% by Jan 2024.

Phoenix Housing Market Forecast 2023

What could be the Phoenix real estate market predictions for 2023? Phoenix is the 5th largest city in the country and continues to grow. New residents are drawn to Phoenix by its strong economy, relatively low cost of living, high quality of life, economic opportunity, and cultural attractions. Since 2000, Phoenix’s population has grown by 20% to include approximately 555,013 households and 1.6 million people.

It is the biggest city in Arizona and the state’s capital. It is a minimally walkable city in Maricopa County with a population of approximately 1,442,530 people. However, Phoenix itself is massive. It is the only state capital with more than a million people. It is the fifth-largest city in the country. The Phoenix housing market is much larger than Phoenix itself – it encompasses the entire Valley of the Sun, Phoenix’s sprawling suburbs that are home to another five million people. That makes the Phoenix metro area the twelfth largest in the country.

The favorable living conditions have, furthermore, comforted real estate investors and buyers to invest in Arizona real estate market. The Phoenix housing market was a headline in the news a decade ago when the housing crisis of 2007 and 2008 caused home values here to fall by as much as half. The slow recovery of the national housing market has taken a decade.

Since 2006, the population has grown faster than housing. This growth fueled by job growth has finally consumed the glut of re-sale housing created during the bubble years. Now the market is facing a shortage of homes for sale. Phoenix home prices were up by roughly 7% over the last twelve months. Despite the increase in property prices, the Phoenix real estate market remains much more affordable than in other places.

Single-family homes continue to drive the Arizona real estate market. In 2019, single-family homes grew by roughly 4% as compared to 2018. Particularly, previously-owned single-family houses compromise the majority of residential sales in the Arizona real estate market- approximately 80% of all sales. Annually, the number of previously-owned single-family homes is three to four times greater than new single-family home sales.

The Phoenix real estate market is the top-performing, not only in the Arizona real estate market but nationwide as well. Phoenix has a mixture of owner-occupied and renter-occupied housing units for sale. According to Neigborhoodscout.com, a national real estate data provider, three and four-bedroom single-family detached are the most common housing units in Phoenix. Other types of housing that are prevalent in Phoenix include large apartment complexes, duplexes, rowhouses, and homes converted to apartments. Single-family homes account for about 60% of Phoenix's housing units.

The current typical home value of homes in the Phoenix-Mesa-Scottsdale Metro is $433,926. It indicates that 50 percent of all housing stock in the area is worth more than $433,926 and 50 percent is worth less (adjusting for seasonal fluctuations and only includes the middle price tier of homes). Home values have gone up 3.6% over the past twelve months.

According to NeighborhoodScout.com, in the past ten years, Phoenix real estate appreciated by 261.05%. This amounts to an annual real estate appreciation of nearly 13.70%, which puts Phoenix in the top 10% nationally for real estate appreciation. During the last twelve months (2021 Q3 – 2022 Q3), Phoenix's appreciation rate has been 20.16%, which is higher than appreciation rates in 88.31% of the cities and towns in the nation. In the quarter, between 2022 Q2 – 2022 Q3, the appreciation rate has been 5.04%.

Here is the latest housing forecast for Phoenix Metro Area.

  • Phoenix-Mesa-Scottsdale Metro home values have gone up 3.6% over the past year.
  • The Phoenix metro housing market forecast ending January 2024 is negative.
  • Zillow predicts that Phoenix metro home values may drop by 1.2% between January 2023 to January 2024.
  • If this forecast is correct, Phoenix metro home prices will be slightly lower in the 4th Quarter of 2023 than they were in the 4th Quarter of 2022.
Phoenix Housing Market Forecast
Source: Zillow.com

Phoenix Real Estate Investment: Should You Invest in Phoenix?

Should you consider Phoenix real estate investment? Many real estate investors have asked themselves if buying a property in Phoenix is a good investment. You need to drill deeper into local trends if you want to know what the market holds for real estate investors and buyers in 2023. If you are looking to make a profit, you don’t want to buy the most expensive property on the Phoenix real estate market and expect to make a good profit on rents.

Perhaps you are looking for a slightly different hold-over, an investment property in Phoenix that you might move into or sell at retirement in the future. Either way, knowing your profit potential and purpose is the first thing to consider. Let’s take a look at the number of positive things going on in the Phoenix real estate market which can help investors who are keen to buy an investment property in this city. We’ll address the biggest factor pulling people to the Phoenix housing market next.

Relatively Affordable Real Estate Market

While California and Florida are seen as hot real estate markets, one of the major attractions of the Phoenix real estate market is affordable real estate. During 2018 and 2019, Arizona was one of the top three states in the nation for population growth. Only Texas and Florida outpaced it, in terms of year-over-year growth. Population growth is particularly high within the Phoenix metro area. Homes in the Phoenix housing market are approaching the 2006 record. Home-price appreciation appears to be slowing a bit in the Phoenix area and most experts agree that prices will continue to climb for the foreseeable future.

According to the U.S. Census Bureau data, the population of the city of Phoenix rose by nearly 15% from 2010 to 2019. That’s well above the nation’s growth rate for that same timeframe. Population growth increases the demand for housing on both the purchase and rental sides. With all other things being equal, steady population growth tends to put upward pressure on home prices. The median home’s value has crossed $300,000 but that’s still cheaper than a starter home in coastal California. Don’t forget that the large retiree market means there is strong demand for one and two-bedroom houses and condos here, and those units are a fraction of the cost of a three-bedroom home.

High Rate of Appreciation Due To Short Supply

Although Phoenix has experienced consistent population growth, the housing market has not grown at the same rate. An Up for Growth study found that between 2000 and 2015 Arizona underproduced 505,134 housing units. This underproduction has caused a housing shortage in Phoenix. For example, in the last 30 years Phoenix produced approximately 220,000 new housing units, however, the population has grown by 820,000 people. Phoenix’s housing production has not kept pace with population growth.

This underproduction was magnified when construction virtually shut down during the recession of 2008. Since that time, construction has slowly increased but has not reached the level of production achieved before the recession. The current shortages of housing supply, relative to demand, are a primary reason housing costs are increasing. A significant increase in housing supply is necessary to keep pace with current and projected housing demand.

Highest Appreciating Phoenix Neighborhoods Since 2000 (List by Neighborhoodscout)

  1. Central City North
  2. Garfield
  3. Kenwood / Whites
  4. Roadrunner Park / Sleepy Hollow Trailer Village
  5. W Fremont Rd / S 15th Ln
  6. Talasera
  7. Papago Peaks Village / Parkview Village Park
  8. Villa Verde / Encanto Estates
  9. Lafamilia East
  10. Green Acres Park

The Growing Phoenix Rental Market

There is always going to be high tenant turnover in student housing markets. The presence of universities also influences local home prices and rents. The capital of any state will be home to its flagship university, and Phoenix is no exception. Phoenix is so large that it doesn’t just host the flagship Arizona State University campus in Tempe.

There are secondary campuses in downtown Phoenix, northwest Phoenix, and neighboring Glendale. These schools alone have more than seventy thousand students. The Arizona Summit Law School, Grand Canyon University, and several others are located here. There are easily 100,000 college students renting in the Phoenix housing market. You could invest in large single-family homes or multi-unit buildings to rent to students at any of these campuses.

Phoenix Rental Trends: 36% of the households in Phoenix are renter-occupied while 64% are owner-occupied. The rents are rising and it makes sense to keep your home and rent it out. In some neighborhoods, the average rental home may rent well over $2,500 a month.

As of February 19, 2022, the average rent for a 1-bedroom apartment in Phoenix, AZ is currently $1,405. This is an 8% increase compared to the previous year. Over the past month, the average rent for a studio apartment in Phoenix increased by 13% to $1,296. The average rent for a 1-bedroom apartment increased by 8% to $1,405, and the average rent for a 2-bedroom apartment increased by 7% to $1,725.

  • Two-bedroom apartment rents average $1,725 (a 7% increase from last year).
  • Three-bedroom apartment rents average $2,250 (a 5% increase from last year).
  • Four-bedroom apartment rents average $2,500 (a 4% increase from last year).

The “Zumper Phoenix Metro Area Report” analyzed active listings last month across the metro cities to show the most and least expensive cities and cities with the fastest growing rents. The Arizona one bedroom median rent was $1,357 last month. Scottsdale was the most expensive city with one bedrooms priced at $2,030 whereas Bullhead City ranked as the most affordable city with one bedrooms priced at $1,000.

The best place to buy rental property is about finding growing markets. Cities like Surprise and Glendale are good for investors looking to get started with rental property ownership at an affordable price. These trends provide a macro look at the growing rental demand. Each real estate market has its own unique supply-demand dynamics with unique neighborhoods that present their own opportunities for investors.

These cities look good for rental property investment this year as rents are growing over there.

The Fastest Growing Cities For Rents in Phoenix Metro Area (Y/Y%)

  • Bullhead City had the fastest growing rent, up 31.6% since this time last year.
  • Phoenix saw rent climb 12.9%, making it second.
  • Flagstaff was third with rent jumping 9.3%.

The Fastest Growing Cities For Rents in Phoenix Metro Area (M/M%)

  • Surprise rent had the largest monthly growth rate, up 6.1%.
  • Scottsdale rent increased 5.2% last month, making it second.
  • Casa Grande was third with rent climbing 5%.
Phoenix Rental Market Trends
Source: Zumper

Phoenix's Growing Short-Term Rentals

There are more than 200 golf courses in Arizona, but most are located in and around the Valley of the Sun. There are several sports teams located in Phoenix and a wealth of tourist attractions. What makes Arizona unusual is the state’s open relationship with rental sites like Airbnb. A law that went into effect in 2016 made Arizona a leader in Airbnb rentals. The sites are required to collect taxes on the rentals, simplifying revenue collection for the state and the landlords. That probably explains why Airbnb guests grew by 150% in 2016 alone. The Airbnb market has exploded in Arizona during the past five years.

In late 2014, Phoenix only had 687 properties for rent listed on Airbnb. By March of 2019, that number had grown to 4,224 listed properties. This makes Phoenix a great place to buy a single-family home or condo to rent out to tourists (as a short-term rental). However, there are some restrictions on short-term rentals. In May 2019, the state government passed a bill allowing for more regulations of short-term rental operators in the state of Arizona.

In the bill, municipalities were allowed to restrict rentals to overnight stays and prohibit events that otherwise would require a permit, like weddings. Under the new law, owners of short-term rentals should have a sales tax license and they must list the sales tax license number on any advertisements (online/offline) for the property. Although, Phoenix’s short-term rental industry was hit hard by the COVID-19 pandemic the industry has shown resilience with relatively fair returns as owners implement safety measures to curb the spread of the virus and encourage guests to feel safe.

Phoenix is Landlord Friendly

If you want to invest in real estate, you typically want to do so in a market where you can quickly evict people who don’t pay their rent or damage property. You’ll be glad to know that the Phoenix real estate market is among these compared to surrounding states. Arizona, unlike California, allows landlords to serve an unconditional quit notice. If the tenant violates the rental agreement or doesn’t pay rent, they can be evicted quickly. Renter-friendly rules like requiring a landlord to return a rental deposit within two weeks are not a burden. Conversely, laws that say you can evict a tenant within ten days for lying on a rental application are a definite plus.

The Massive Snowbird Market

The snowbird movement is somewhat different than the conventional tourist market. Arizona has long attracted retirees who couldn’t afford Florida or wanted cleaner, allergy-free air that never included storm clouds. Quartzite, Arizona in particular draws two million snowbirds and tourists. The city stands out for its sixty-plus RV parks. An estimated 300,000 people stay all winter before returning home. Some own second homes in Arizona communities restricted to active adults, while others stay in trailer parks. This creates an unusually diverse opportunity for those considering investing in the Phoenix real estate market.

Growing Retiree Market

The same things attract many people to Phoenix as snowbirds cause many to retire here permanently. This means that many snowbirds end up staying permanently in the Phoenix housing market. Sun City stands out as a mecca for seasonal and year-round retirees, but it is far from the only retirement community in the Phoenix real estate market. The aging of the U.S. population makes investing in communities catering to older adults an excellent idea. Suppose you buy a house to renovate and rent out. Phoenix deals with a large retiree population, both permanent and seasonal.

To accommodate aging in place, they’ve loosened the rules on building “accessory dwelling units”, commonly known as mother-in-law suites. The city also recognizes the need for affordable housing, and they allow people to build and rent out ADUs as affordable housing, especially if the property is within walking distance of public transit. Buy a house, rehab it, and build a granny flat, and you have two rental properties for not much more than the price of one. And the city is almost certain to approve it because they want denser development.

Low Taxes in Arizona

Kiplinger listed Arizona as the 8th most tax-friendly state in the U.S. in 2018. The state income tax is 2.59% for low-income earners, 4.54% for wealthier families. The median home is worth around $177,000 and came with a property tax bill of around $1400, well below what you’d pay in Texas. Arizona has been lowering its capital gains tax rate, as well. The state has a relatively low transfer tax on deeds or land contracts, too.

The Major Wave of Renovation in Downtown Phoenix

The section of Phoenix wedged between Seventh Street and Seventh Avenue is undergoing a wave of commercial redevelopment, fueled by more than five billion dollars invested to date. High-rise developments and mixed-use projects have been built, and several more are underway. Public transit in this area is significantly improved. That is making this area and neighborhoods bordering it an excellent place to invest in the Phoenix housing market. Phoenix isn’t just redeveloping downtown to create a dense, walkable urban core. It is cultivating fifteen complete walkable communities across the metro area with strong public transit, denser housing, and locally provided services. This is a radical shift from the suburban sprawl the area has long been known for.

Phoenix, Arizona Real Estate Investment Markets

Investing in Phoenix's real estate can be a worthy investment due to a steady rate of appreciation. It’s only wise to think about how you can and should be investing your money. In any property investment, cash flow is gold. The Phoenix housing market is one of the hottest markets for 2020. Don’t let memories of the Great Recession bust that cut home values in the Phoenix housing market keep you away. There are plenty of reasons to invest in the Phoenix real estate market, only ten of which we’ve provided above. Have a look at the Phoenix real estate investment prospects we have provided from various real estate sources and make the best possible decision for yourself.

Good cash flow from Phoenix investment properties means the investment is, needless to say, profitable. The three most important factors when buying real estate anywhere are location, location, and location. The location creates desirability. Desirability brings demand. There should be a natural and upcoming high demand for rental properties. Demand would raise the price of your Phoenix investment property and you should be able to get a good return on your investment over the long term. The neighborhoods in Phoenix must be safe to live in and should have a low crime rate.

The neighborhoods should be close to basic amenities, public services, schools, and shopping malls. A cheaper neighborhood in Phoenix might not be the best place to live in. A cheaper neighborhood should be determined by these factors – Overall Cost Of Living, Rent To Income Ratio, and Median Home Value To Income Ratio. Some of the popular neighborhoods for buying a house or an investment property in Phoenix are Vistancia, Laveen, Deer Valley, South Mountain, Biltmore, DC Ranch, Arcadia, McDowell Mountain Ranch, Anthem, North Scottsdale, Cave Creek, Old Town, Litchfield Park, Trilogy at Vistancia and North Phoenix.

Phoenix real estate prices are well above average cost compared to national prices. It depends on how much you are looking to spend and if you are wanting smaller investment properties or larger deals such as duplex and triplex in Class A neighborhoods. The inventory is low, but opportunities are there.

Even as Phoenix home prices have reached new heights, the market remains attractive to residential real estate investors. As they continue to compete for potential investment properties at the lower end of the market, the challenges for first-time homebuyers will remain. The homebuyers won’t be able to outbid real estate investors and would end up renting. As with any real estate purchase, act wisely. Evaluate the specifics of the Phoenix housing market at the time you intend to purchase. These prices are from Realtor.com and can vary from time to time.

The super-hot housing market in Arizona has many other places for real estate investment. The Tucson real estate market is good for investment. Tucson like Phoenix sees a massive influx of snowbirds, and retirees who flock here during the winter. That creates a large, seasonal rental market. The need for many retirees to sell their second homes when they can no longer travel or live independently provides an opportunity to snap up properties at a bargain rate. Better yet, a large number of those properties don’t have a mortgage on them. Other snowbirds sell their condo and move into single-family homes when they decide to stay in Tucson year-round.

Similarly, Scottsdale has a track record of being one of the best long-term real estate investments in the nation if you are an investor. The area contains a mix of families, young professionals, and retirees. There are several reasons to consider investing in Scottsdale real estate. You’ll see better-than-average returns on the average Scottsdale real estate investment property, and its value will be bolstered by a variety of factors. 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, and retirees who come for the winter before returning home. This makes Scottsdale a good place for real estate investing.

Chandler is bordered by the cities of Tempe, Mesa, and Phoenix. It is home to about a quarter-million people. There are not suburbs to Chandler, because it is a suburb of Phoenix surrounded by other cities of similar size. However, Chandler has several points in its favor that make it a better choice for real estate investors than surrounding cities. The Chandler area offers strong market fundamentals in addition to a favorable tax and regulatory climate. This is in addition to a plethora of high-paying jobs that attract new residents and niche markets that are willing to pay higher rents in exchange for convenience and proximity to amenities.

Buying or selling real estate, for a majority of investors, is one of the most important decisions they will make. Choosing a real estate professional/counselor continues to be a vital part of this process. They are well-informed about critical factors that affect your specific market areas, such as changes in market conditions, market forecasts, consumer attitudes, best locations, timing, and interest rates.

NORADA REAL ESTATE INVESTMENTS has extensive experience investing in turnkey real estate and cash-flow properties. We strive to set the standard for our industry and inspire others by raising the bar on providing exceptional real estate investment opportunities in many other growth markets in the United States. We can help you succeed by minimizing risk and maximizing the profitability of your investment property in Phoenix.Consult with one of the investment counselors who can help build you a custom portfolio of Phoenix turnkey properties. These are “Cash-Flow Rental Properties” located in some of the best neighborhoods of Phoenix.

Not just limited to Phoenix or Arizona but you can also invest in some of the best real estate markets in the United States. All you have to do is fill up this form and schedule a consultation at your convenience. We’re standing by to help you take the guesswork out of real estate investing. By researching and structuring complete Phoenix turnkey real estate investments, we help you succeed by minimizing risk and maximizing profitability.

Let us know which real estate markets you consider best for real estate investing! 


Remember, caveat emptor still applies when buying a property anywhere. Some of the information contained in this article was pulled from third-party sites mentioned under references. Although the information is believed to be reliable, Norada Real Estate Investments makes no representations, warranties, or guarantees, either express or implied, as to whether the information presented is accurate, reliable, or current. All information presented should be independently verified through the references given below. As a general policy, Norada Real Estate Investments makes no claims or assertions about the future housing market conditions across the US.

REFERENCES

  • https://armls.com/
  • https://www.zillow.com/Phoenix-az/home-values
  • https://www.redfin.com/city/14240/AZ/Phoenix/housing-market
  • https://www.realtor.com/realestateandhomes-search/Phoenix_AZ/overview
  • https://www.zillow.com/research/zillow-hottest-markets-2021-28667/
  • https://smartasset.com/data-studies/where-housing-markets-are-cooling-off-most-2022
  • https://www.neighborhoodscout.com/az/phoenix/real-estate#description
  • https://www.zumper.com/rent-research/phoenix-az
  • https://www.phoenix.gov/housingsite/Documents/Final_Housing_Phx_Plan.pdf
  • https://www.abc15.com/news/state/as-arizona-housing-prices-rise-wages-are-not-keeping-up
  • https://metrorealtyphx.com/phoenix-real-estate-market-report-this-month
  • https://arizonarealestatenotebook.com/phoenix-housing-market-predictions-2019
  • https://www.curbed.com/2016/11/4/13518302/downtown-phoenix-real-estate-urban-planning-devleopment
  • http://capstonecapitalusa.com/the-most-friendly-8-landlord-states
  • https://www.rentcafe.com/blog/renting/states-best-worst-laws-renters
  • https://universe.byu.edu/2017/02/22/this-tiny-arizona-desert-town-is-a-retirement-mecca-for-2-million-human-snowbirds/
  • https://www.tripsavvy.com/what-is-a-snowbird-2683049
  • https://www.azcentral.com/story/news/politics/legislature/2016/07/27/airbnb-arizona-benefits/86314492/
  • https://www.bizjournals.com/phoenix/news/2017/02/15/exclusive-airbnb-hosts-in-arizona-earned-51m-in.html
  • https://www.kiplinger.com/slideshow/taxes/T006-S001-10-tax-friendly-states/index

Filed Under: Growth Markets, Housing Market, Real Estate Investing Tagged With: phoenix home prices, Phoenix Housing Market, Phoenix Housing Market Forecast, Phoenix Investment Property, Phoenix Real Estate, Phoenix Real Estate Market

Virginia Beach Housing Market: Prices,Trends, Forecast 2023

March 16, 2023 by Marco Santarelli

Virginia Beach Real Estate Market

As mortgage rates continue to rise, many are curious about what lies ahead for the Virginia and Virginia Beach housing market. With rising home prices and changing trends, it's important to stay informed. In this article, we'll explore the current state of the market, trends to watch, and forecasts for 2023. Whether you're a buyer or seller, this information can help guide your decisions in the year to come.

Overview of the Virginia Housing Market in 2023

The Virginia housing market has experienced a significant decline in sales activity and sold dollar volume since January 2022. The average days on the market have been slowing, resulting in an increase in the supply of homes. The state is still considered a seller’s market due to low inventory, but market dynamics continue to shift in favor of buyers.

Decline in Sales Activity and Sold Dollar Volume:

According to the January 2023 Virginia Home Sales Report, the number of homes sold across Virginia decreased by more than 30% compared to the previous year, marking the slowest January market in eight years. The sold dollar volume was also down by about $1 billion, a 28.5% decline.

Slowing Days on Market:

The average days on the market statewide was 39 days, a full week longer than January 2022. This cooling has been a result of rising interest rates coupled with rising home prices and a lack of homes available on the market.

Increase in Supply of Homes:

Homes remaining on the market longer have resulted in an increase in the supply of homes for the fourth month in a row. While about three out of every four cities and counties in Virginia had more active listings than the same time last year, the overall inventory remains low compared to historical averages. The sharpest increases in listings occurred in parts of Northern Virginia, the Charlottesville region, and the Northern Neck market.

Market Dynamics Favoring Buyers:

Virginia’s housing market is still considered a “seller’s market” due to the low inventory, but the overall market dynamics continue to shift in favor of buyers. Fewer offers are coming in, and there is less of a scramble to outbid other buyers. Additionally, fewer sellers are receiving their full asking price. These trends are expected to continue in the coming months as the market responds to economic uncertainty and the volatile interest rate environment.

“Northern Virginia” Housing Market Trends 

The Northern Virginia Association of Realtors® reports on home sales activity for Fairfax and Arlington counties, the cities of Alexandria, Fairfax, and Falls Church, and the towns of Vienna, Herndon, and Clifton.

Based on their recent report, the state of the Northern Virginia housing market seems to be experiencing a mixed trend. The number of closed home sales in January 2023 declined by 33.6% compared to January 2022, which could indicate a cooling off in the market. However, pending sales in January grew by 14% from the previous month, which suggests that there may be an increase in market activity in the near future. The average days on the market increased only slightly, indicating that homes are still selling quickly, despite lower sales activity.

Inventory remains tight, but it is up by 88.4% compared to a year ago. This increase in inventory is a positive sign for buyers as it means they have more options to choose from, and there is more time for decision-making. Additionally, there were considerably more active listings available in January 2023 compared to January 2022, an increase of 41.5%. This indicates that there is still demand for homes in the region, despite the decline in sales activity.

The median selling price continued to grow in Northern Virginia, rising 6.8% from January 2022 to $610,000. This growth in median sold price suggests that there is still strong demand for homes in the area. The average sold price for a home in January 2023 was $718,773, up 2.3% from January 2022 and significantly higher than the pre-pandemic average sold price of $565,032 in January 2019.

In summary, the Northern Virginia housing market is experiencing a cooling trend in terms of closed home sales, but there are signs of increased market activity in pending sales. Despite lower sales activity, homes are still selling quickly, and there is strong demand for homes in the region, as evidenced by the growth in median and average sold prices. The increase in inventory is a positive sign for buyers, and the market is expected to pick up with springtime.

“Virginia Beach” Housing Market Trends

Based on the data by Redfin, the Virginia Beach housing market is competitive, with homes receiving an average of 3 offers and selling in around 25 days. In February 2023, the median home price in Virginia Beach was $330,000, which represents a 1.5% increase from the previous year. The average sale price per square foot was also up by 1.5% since last year, at $201.

However, the number of homes sold in February 2023 was down from the previous year, with only 408 homes sold compared to 522 homes sold in February 2022. Homes are still selling at or near their list price, with hot homes selling for around 2% above the list price and going pending in just 13 days.

Overall, the Virginia Beach housing market is experiencing moderate growth, with home prices increasing slightly and homes selling quickly. Despite the decrease in the number of homes sold, the competitive nature of the market suggests that demand for housing in the area remains high. As such, it may be a good time for sellers to list their homes, while buyers may need to act quickly to secure a property in the area.

Virginia Beach Housing Market Forecast 2023-2024

The Virginia Beach-Norfolk-Newport News housing market has been experiencing steady growth over the past year, with an average home value of $313,229, up 5.4% since last year, according to Zillow. Homes in this area typically go to pending in around 26 days.

Looking at the market forecast for the next year, it is projected that the Virginia Beach housing market will experience a 0.6% increase in value by February 28, 2024. The median sale-to-list ratio was 1.000 as of January 31, 2023, indicating that homes are generally selling at or close to their listing price. Additionally, 34% of homes sold over the list price and 31.6% of homes sold under the list price, showing that there is some variation in the market. The median days to pending as of February 28, 2023, was 26.

Compared to other MSA-level forecasts in Virginia, the Virginia Beach housing market is predicted to have moderate growth, with a projected 0.6% increase in value by February 28, 2024. Other cities such as Martinsville are expected to have more significant growth, with a projected 2.3% increase in value by the same date. However, it is important to note that projections can change, and the real estate market can be influenced by a variety of factors such as interest rates, employment rates, and the overall economy.

For buyers, the Virginia Beach market remains competitive, with homes receiving multiple offers and some selling for the above list price. It may be helpful to work with an experienced real estate agent and be prepared to act quickly when a desirable property becomes available. For sellers, it is a good time to sell, given the steady growth in the market, but it is important to be realistic with pricing and work with an experienced agent who can help maximize the value of the property.

Virginia Beach Housing Market Forecast
Credits: Zillow.com

Virginia Beach Real Estate Investment Overview

Virginia Beach is a popular destination for real estate investment due to its robust and competitive housing market. The city offers a diverse range of properties, including beachfront homes, condos, townhouses, and single-family homes. The average home value in the Virginia Beach-Norfolk-Newport News area is $313,229, with an annual increase of 5.4%. Additionally, homes in Virginia Beach typically go to pending status in around 26 days.

Here are the top reasons to invest in the Virginia Beach MSA for the long term:

Sure, here's more information on each point:

  • Strong economy: Virginia Beach has a strong and diversified economy, with major industries including military, tourism, healthcare, and education. The military presence is particularly significant, with several military bases and facilities located in the area, including Naval Air Station Oceana and Joint Expeditionary Base Little Creek-Fort Story. This helps to provide stability to the local economy and job market.
  • Population growth: Virginia Beach has seen steady population growth over the years, with a current population of over 450,000 people. This growth is expected to continue in the coming years, which bodes well for real estate investors. With more people moving to the area, there will be increased demand for housing, which can drive up prices and rental rates.
  • Rental market: Virginia Beach has a strong rental market, with a high percentage of renters in the area. This is due in part to the large military population, many of whom prefer to rent rather than buy. Additionally, the area's strong tourism industry means that there is a steady demand for short-term rentals, such as vacation homes and Airbnb.
  • Affordable housing: Despite its many amenities and strong economy, Virginia Beach is still relatively affordable compared to other coastal cities. The median home value in the area is around $313,000, which is significantly lower than the median home value in cities like San Francisco or New York. This makes it a more accessible market for real estate investors who may not have the capital to invest in more expensive cities.
  • Quality of life: Virginia Beach is consistently ranked as one of the best places to live in the United States, thanks to its high quality of life. The area boasts miles of beautiful beaches, excellent schools, and a wide range of cultural and recreational amenities. This makes it an attractive place for people to live and work, which in turn makes it an attractive place to invest in real estate.
  • The Landlord-Friendly State of Virginia: Virginia is generally considered a landlord-friendly state due to its laws and regulations that tend to favor landlords over tenants. This means that if you decide to invest in rental property in Virginia, you can expect a relatively smooth and hassle-free process of managing and renting out your property. Some examples of landlord-friendly laws in Virginia include allowing landlords to charge non-refundable fees, enforcing strict lease terms, and relatively quick eviction processes. These factors can make Virginia a desirable state for real estate investors looking to maximize their rental income while minimizing their risks and legal liabilities.

Overall, these factors combine to make Virginia Beach a strong real estate investment market. With a strong economy, growing population, strong rental market, affordable housing, and high quality of life, it's easy to see why investors are drawn to the area. The Virginia Beach real estate market presents an ideal mix of high demand, constrained supply, and a large number of renters who won’t go buy a house if interest rates drop.

The diverse local economy allows you to cater to tourists knowing you can rent the property out to locals, as well. Buying an investment property is different from buying an owner-occupied home. Investment properties are designed to make money as rentals, which means you must look at them solely as an income-producing entity just like any other business.

Whether you are a beginner or a seasoned investor, you probably realize the most important factor that will determine your success as a real estate investor is your ability to find great real estate investments. We strive to set the standard for our industry and inspire others by raising the bar on providing exceptional real estate investment opportunities.

Let us know which real estate markets you consider best for real estate investing! If you need expert investment advice, you may fill up the form given here. One of our investment specialists will get in touch with you to discuss all facets of searching for, buying, and owning a turnkey investment property.


Remember, caveat emptor still applies when buying a property anywhere. The information contained in this article was pulled from third-party sites mentioned under references. Although the information is believed to be reliable, Norada Real Estate Investments makes no representations, warranties, or guarantees, either express or implied, as to whether the information presented is accurate, reliable, or current. All information presented should be independently verified through the references given below. As a general policy, Norada Real Estate Investments makes no claims or assertions about the future housing market conditions across the US.

References:

  • https://virginiarealtors.org/
  • https://www.zillow.com/VirginiaBeach-va/home-values
  • https://www.neighborhoodscout.com/va/virginia-beach/real-estate
  • https://www.realtor.com/realestateandhomes-search/Virginia-Beach_VA/overview
  • https://www.nvar.com/realtors/news/market-statistics
  • https://www.redfin.com/city/20418/VA/Virginia-Beach/housing-market

Filed Under: Growth Markets, Housing Market, Real Estate Investing

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