The Phoenix housing market is on fire, driven by strong economic growth, once in a generation affordability levels, and a surge in investment activity that far surpasses the levels during the housing boom. Once considered to be ground zero of the housing market collapse, Phoenix has orchestrated a dramatic turnaround in recent months and has considerably outpaced other distressed markets such as Las Vegas, Riverside, San Bernardino and Sacramento. Phoenix was one of the hardest hit housing markets during the bust, with home values declining 57% from 2006 through mid-2011.
But since the middle of 2011, the housing conditions in Phoenix have markedly improved and prices have begun to rise. Certainly record affordability has helped nudge hesitant homebuyers off of the sidelines in recent months, but affordability is now excellent in nearly every market in the country.
So why has Phoenix experienced such a sharp rebound while many other markets continue to struggle? Improvement in the following market drivers are playing a key role in Phoenix's recent surge: