How is The Tucson Real Estate Market in 2019?
Real estate market booming in Southern Arizona and housing experts see positive trends in the Tucson market. The Tucson real estate market hit the news a decade ago for hitting incredible highs before the average home value was cut in half. However, the Tucson real estate market’s slow recovery has been overlooked by the media and investors alike.
Let’s take a look at the Tucson market today. Tucson is home to around half a million people. The Tucson housing market is larger than that, though, because the Tucson metropolitan area is home to around a million people in all. The Tucson housing market is seeing moderately strong demand, but the Tucson housing market is nowhere near the insanely overheated conditions it saw in the 2008 housing bust.
Tucson is Southern Arizona’s thriving metropolis. Metropolitan Tucson has about a million residents, but the population increases dramatically between December and March when Snow Birds fly south to enjoy our pleasant winter. Tucson loves Snow Birds.
In November 2018, the median list price of homes in Tucson, AZ was $241K, trending up 4.8% year-over-year. One of the big factors in the real estate sector’s performance is going to be Tucson’s ability to continue to attract new companies and to attract other companies to come to this region.
The more sustained growth in the Tucson real estate market buoys confidence in the area, allowing the market to overcome obstacles that have been problematic in the past. The Tucson area is slowly growing and has excellent long term prospects.
Is Tucson going to be one of the hottest real estate markets for investors in 2019 & 2020? Let’s take a deep look at the latest Tucson housing market trends to come to a conclusion.
Tucson Arizona Real Estate Market Forecasts 2019 & 2020
According to Zillow, the median home value in Tucson is $193,000. Tucson home values have gone up 5.7% over the past year and their Tucson real estate market prediction is that the prices will rise 3.4% within the next year. The median list price per square foot in Tucson is $139, which is lower than the Tucson Metro average of $139.
The median price of homes currently listed in Tucson is $225,000 while the median price of homes that sold is $202,200. The median rent price in Tucson is $1,295, which is lower than the Tucson Metro median of $1,350.
Here is the Tucson, AZ real estate price appreciation graph by Zillow. It shows us the current home price appreciation forecast of 3.4% till Aug 2020.
Tucson Housing Market Forecast 2019 – 2021
The Tucson housing market forecast for the 3 years ending with the 3rd Quarter of 2021 is also positive. The Accuracy of the Trend Prediction for Tucson is 78%. Accordingly, LittleBigHomes.com estimates that the probability for rising house prices in Tucson, AZ is 78% during this period. If this Housing Market Forecast is correct, home values will be higher in the 3rd Quarter of 2021 than they were in the 3rd Quarter of 2018.
Check this page each quarter for updates to the Tucson, AZ Real Estate Market Forecast.
Tucson Real Estate Market Trends
The residential real estate market in Tucson continues to churn unimpeded. According to Trulia, Tucson real estate market trends indicate an increase of $10,100 (6%) in median home sales and a 0% rise in median rent per month over the past year. The average price per square foot for this same period rose to $134, up from $126.
The median sales price for homes in Tucson for Jul 18 to Oct 17, 2018 was $190,000 based on 3,014 home sales. Average price per square foot for Tucson was $134, an increase of 6% compared to the same period last year. The median rent per month for apartments in Tucson for Sep 22 to Oct 22 was $1,200.
Currently, Trulia has 3,970 resale and new homes for sale in Tucson, AZ, including open houses, and homes in the pre-foreclosure, auction, or bank-owned stages of the foreclosure process. The median sales price is $210,000. Homes are selling for about $143/sqft.
As per Redfin.com’s data, the Tucson housing market is somewhat competitive. Homes in Tucson receive 1 offers on average and sell in around 48 days. The average sale price of a home in Tucson was $215K last month, up 3.0% since last year. The average sale price per square foot in Tucson is $135, up 4.7% since last year.
Homes typically receive 1 offer. Homes in the Tucson housing market sell for about 2% below list price and go pending in around 48 days. Hot homes in Tucson, AZ can sell for around list price and go pending in around 31 days.
There are 5,403 homes for sale in Tucson, AZ on Realtor.com. 415 of which were newly listed within the last week. Additionally, there are 990 Tucson rentals for sale, up to to $12K per month. In August 2019 the Tucson housing market was a seller’s market, which means there were roughly more buyers than there were active homes for sale.
According to Realtor.com, in August 2019, the median list price of homes in Tucson, AZ was $249K, trending up 4.2% year-over-year. The median listing price per square foot was $142. The median sale price was $226K. On average, homes in Tucson, AZ sell after 55 days on the market. The trend for median days on market in Tucson, AZ has gone down since last month, and slightly down since last year.
On Movoto, the median list price in Tucson is $278,000. The median list price in Tucson went up 1% from August to September. Tucson’s home resale inventories is 1,934, which increased 1 percent since August 2019. The median list price per square foot in Tucson is $151. August 2019 was $149. Distressed properties such as foreclosures and short sales remained the same as a percentage of the total market in September.
Tucson, AZ Single Family And Multi-Family Homes
Following the real estate market decline in 2007 in the U.S., single family rental homes became favorable options for investors, saving in construction or refurbishment prices. The quick turnaround for an owner to rent out their property means cash flow is almost immediate.
Single family rental home have grown up to 30% within the last three years. Almost all the housing demand in the US in recent years has been filled by single family rental units.
As per the real estate company called Neigborhoodscout.com, the median house price in Tucson, AZ is $170,397, which indicates that home prices in Tucson are near the national average for all cities and towns in the United States. Single-family detached homes are the single most common housing type in Tucson, accounting for 53.37% of the city’s housing units.
One or two bedroom single-family detached homes are most common housing units Tucson. Other types of housing that are prevalent in Tucson include large apartment complexes, row houses, a few duplexes and homes converted to apartments. Tucson has a mixture of owner-occupied and renter-occupied housing.
Currently, there are 2,349 single family homes for sale in Tucson, AZ on Zillow. Additionally, there are 482 single family homes for rent in Tucson, AZ. Under potential listings, there are about 20 Foreclosed and 424 Pre-Foreclosure homes. These are the properties that may be coming to the market soon but are not yet found on a multiple listing service (MLS).
Tucson, AZ Foreclosures And Bank Owned Homes 2019
As per the Tucson foreclosure data by Zillow, in Tucson 0.8 homes are foreclosed (per 10,000). This is greater than the Tucson Metro value of 0.7 and also lower than the national value of 1.2. The percent of delinquent mortgages in Tucson is 0.9%, which is lower than the national value of 1.1%.
With U.S. home values having fallen by more than 20% nationally from their peak in 2007 until their trough in late 2011, many homeowners are now underwater on their mortgages, meaning they owe more than their home is worth.
The percent of Tucson homeowners underwater on their mortgage is 9.3%, which is higher than Tucson Metro at 9.2%.
|Foreclosures in Tucson||516|
|Homes for Sale in Tucson||1,801 (RealtyTrac)|
|Median List Price||$219,900 (2% ⇓ vs Jul 2018)|
There are currently 516 properties in Tucson, AZ that are in some stage of foreclosure (default, auction or bank owned) while the number of homes listed for sale on RealtyTrac is 1,801. In August 2019, the number of properties that received a foreclosure filing in Tucson, AZ was 2% lower than the previous month and 2% lower than the same time last year.
Best Neighborhoods to Invest in Tucson Rental Real Estate
If you are looking to invest in the Tucson rentals, you should know the best places to invest in. The three most important factors when buying a real estate anywhere are location, location, and location. Location creates desirability. Desirability brings demand. Demand would raise the price of your Tucson rental real estate and you should be able flip it for a lump sum profit.
When looking to invest in Tucson real estate, you need to find places where the expected property appreciation forecast is positive. The running costs for owning and managing an Tucson investment property should be low. The neighborhoods in Tucson must be safe to live in and should have a low crime rate.
The neighborhoods should be close to basic amenities, public services and shopping malls. There should be a natural and upcoming high demand for rental properties and a low supply of income properties. There are 185 elementary schools, 114 middle schools, 137 high schools and 75 private & charter schools in Tucson. There are 549 neighborhoods in Tucson.
Some of the best neighborhoods in or around Tucson, Arizona are Rancho Vistoso, Continental Ranch, Catalina Foothills, Central Tucson, El Montevideo, Landsdale, Rincon Vista at Rita Ranch, Sycamore Park Village, Rosemont West, Broadmoor-Broadway, El Encanto Estates, Desert Aire-Loma Linda, Peter Howell, Vista Montana Estates, Highland Vista Cinco Via, and San Clemente.
Catalina Foothills Estates has a median listing price of $585K, making it the most expensive neighborhood. Terra Del Sol is the most affordable neighborhood in Tucson, with a median listing price of $152.5K.
Here are the best neighborhoods to invest in Tucson rental real estate because they have the highest appreciation rates (List by Neigborhoodscout.com).
N Stone Ave / E Congress St
S 6th Ave / W 22nd St
S 10th Ave / W 22nd St
N 6th Ave / E Speedway Blvd
N Main Ave / W Speedway Blvd
E 22nd St / S Park Ave
S Park Ave / E 36th St
U of Arizona / E 6th St
N Campbell Ave / E Grant Rd
Should You Invest in Tucson Rental Real Estate?
Now that you know where Tucson is, you probably want to know why we’re recommending it to real estate investors. Investing in real estate is touted as a great way to become wealthy. Is Tucson a good place to invest in real estate?
Many real estate investors have asked themselves if buying a rental property in Tucson is good investment? You need to drill deeper into local trends if you want to know what the market holds for the year ahead.
We have already discussed the Tucson housing market 2019 forecast for answers on why to put resources into this market. Although, this article alone is not a comprehensive source to make a final investment decision for Tucson but we have collected ten evidence based positive things for those who are keen to invest in the Tucson rentals in 2019.
Investing in Tucson rentals will fetch you good returns in the long term as the home prices in Tucson have been trending up year-over-year. Let’s take a look at the number of positive things going on in the Tucson real estate market which can help investors who are keen to buy an investment property in this city.
We’ll focus on real reasons to invest in the Tucson real estate instead of giving you vague appeals to buy a house or an investment property because of general ambiance and mere promises of future growth.
1. The Massive Seasonal Market
The Tucson real estate market like that of Phoenix sees a massive influx of snowbirds, 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 a single family home when they decide to stay in Tucson year-round.
2. The Military Market
Military service members and their families are another large rental market. Tucson is notable for having a large military base, Davis-Monthan Air Force Base. That employs around eight thousand people. However, unlike some other metropolitan areas, the local economy is rather diversified, so the rise and fall of military spending won’t crater the Tucson real estate market.
3. The Large Student Market
The second largest private employer in the city is the University of Arizona. That college has around 45,000 students. The law school and medical school associated with the university attract students from around the country. Colleges provide a steady stream of renters, whether you’re renting out a building full of efficiency apartments or a single family home shared by several students.
However, because Tucson’s economy is not tied to the rise and fall of the college, if enrollment did decline at the college, people moving to the area for work could move in. That makes the Tucson real estate market far more stable than your typical college town.
4. The Large Tucson Rental Market Overall
The lower than average incomes in the Tucson area make the median home price of $130,000 too expensive for many would be home buyers. Per capita income in 2017 was $22,000, while median household income was just under $40,000.
This has created a large permanent rental population that will take advantage of any affordable housing stock. As of 2017, about 36% of residents rented. Another factor in this equation is the limited supply of new housing in the price range most home buyers would be able to afford.
There is a shortage of properties under $200,000 relative to demand, though competition is stiff for properties at all levels except the $500,000 plus luxury market. This means that those who invest in the Tucson real estate market will guarantee that their property appreciates.
5. The Strong Job Market
We’ve already addressed the university and military base generating demand for rentals in the Tucson housing market. Another factor driving demand is the strong job market overall. Raytheon Missile Systems, for example, employs around 10,000 people.
While Tucson isn’t the capitol of Arizona, it is home to a number of governmental agencies. The US Customs and Border Protection division, for example, employs several thousand people in and around Tucson. The State of Arizona and Pima County each have several thousand jobs in this area, as well.
6. The Low Cost of Tucson Real Estate
The median home in the Tucson housing market was up several percentage points in 2018, but it still came in at under $140,000. The average detached single family home can be bought for less than $200,000, though prices rose 6% year over year. Duplex units cost around $130,000 each.
Townhome units cost around $80,000 each when found in groups of three or more. RVs can be found for less than $40,000, while snowbirds provide an instant market for renting out these cheap, low maintenance properties. Demand in this area is so great that some are advocating the construction of new RV parks to help the Tucson economy.
7. The Good ROI and Opportunities for Even Better Returns
Gross rent in Tucson hovered around $900 a month in 2017. This is somewhat lower than the median US rental rate and a little cheaper than the Arizona median rate. Many people move to Tucson and then commute to work in surrounding cities.
Tucson’s relatively slow and steady growth rate means that new construction is at a crawl. That is causing rents to rise faster than average, especially at the low end of the market. Another factor propping up home prices is the relatively small inventory on the market; snowbirds typically sell when they need to instead of based on market conditions.
The average price for a home in Tucson has risen 10 percent over the last two years, according to data collected from the National Association of Realtors—from $168,909 in February, 2015 to $189,000 in February 2018.
Tucson’s appreciation rate notably has been below the national average for the last ten years. The average annual home appreciation rate in Tucson during the period has been just 0.09%, which is lower than 70% of US communities.
Another issue with the Arizona market is the fact that home values are just now reaching prices they were at in 2008. That created a large number of accidental landlords who bought homes for $200,000 in 2008 and have been renting properties located in the Tucson real estate market though they themselves have left. This creates an excellent opportunity for investors who can pay cash to buy out these long-distance landlords.
8. The Area’s Demographic Momentum
The median age of Tucson residents is 33.2, several years lower than the national median age of 37-38. A large number of students try to find work in the area, and many start their families here. Growth is a steady 1%, a little higher than the national 0.7% growth rate.
However, Tucson is notable for the sheer number of people moving to the city from around the country, adding to the population and nearly guaranteeing their children will remain here. That is aside from the slow but steady international migrants to the area, as well.
9. Tucson is Landlord Friendly
Arizona is incredibly landlord friendly. Evictions are seamless. Arizona’s non-compliance laws require the tenant to pay rent and provide accurate information or else they are guilty of breaching the contract. If the tenant breaches their contract, the lease can be voided within ten days.
Arizona has limited renters’ protections, but those are focused at residents in mobile homes. For example, there are payment grade period laws for those renting mobile homes but not those renting a condo or single family home.
There are limits on late fees charged on late rent for those in mobile homes, but not for those staying in an apartment or rented single family home.
10. It Has Low Property Taxes
Arizona ranks 38th out of 50 states in the property taxes paid as a percentage of the property’s value. That average rate was 0.70%. The national average is 1.19%, while New Jersey takes the unfortunate lead at 2.40%.
Arizona counties and cities can tack on their own property tax bill. The per capita state and local property tax collections cost the average resident $1000 a year, placing Arizona 34th out of the 50 states.
Tucson Real Estate Investment
Maybe you have done a bit of real estate investing in Tucson, AZ but want to take things further and make it into more than a hobby on the side. It’s only wise to think about how you can and should be investing your money. In any property investment, cash flow is gold.
A good cash flow means the investment is, needless to say, profitable. A bad cash flow, on the other hand, means you won’t have money on hand to repay your debt.
Therefore, finding a good Tucson real estate investment opportunity would be a key to your success. If you invest wisely in Tucson rental real estate, you could secure your future. If you are a beginner in the business of cash flow real estate investing, it very important to read good books on real estate.
The less expensive the Tucson rentals are, the lower your ongoing expenses will be. Roughly a $150,000 property is what some experts recommend starting with.
Most investors naturally gravitate to residential property investment. When looking for the best real estate investments in Tucson, you should focus on neighborhoods with relatively high population density and employment growth.
Both of them translate into high demand for housing. If housing supply meets housing demand, real estate investors should not miss the opportunity since entry prices of homes remain affordable.
You must also collaborate and learn from savvy real estate investors who have retired early on in their lives by investing in some of the best real estate markets like Tucson, AZ. The Tucson real estate investing market has recovered and is poised for slow, steady and certain long term growth.
The shifting demographics and known groups eager to sell at the right price provides an excellent opportunity to find bargains almost anywhere in the Tucson real estate market.
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 area, such as changes in market conditions, market forecasts, consumer attitudes, best locations, timing and interest rates.
NORADA REAL ESTATE INVESTMENTS strives to set the standard for our industry and inspire others by raising the bar on providing exceptional real estate investment opportunities in the U.S. growth markets. We can help you succeed by minimizing risk and maximizing profitability.
The aim of this article was to educate investors who are keen to invest in Tucson real estate in 2019. Purchasing an investment property requires a lot of studies, planning, and budgeting. Not all deals are solid investments. We always recommend to do your own research and take help of a real estate investment counselor.
Which Real Estate Markets Are Good To Buy Investment Properties In 2019?
Apart from the Tucson market, you can also go for the Phoenix real estate market, which is that it is going to be a hot investment destination for new real estate investors. Phoenix real estate market trends indicate an increase of $16,000 (7%) in median home sales and a -3% drop in median rent per month over the past year.
As per Trulia, the average price per square foot for this same period rose to $162, up from $148. 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.
Another city that we suggest is the the Little Rock in Arkansas. The Little Rock Arkansas real estate market offers long term value and slow growth, several large permanent populations of renters and excellent financial numbers. You can’t afford to overlook the opportunity the Little Rock housing market offers.
We could say that Little Rock is a great place to invest because it is showing up on national publication’s lists of top places to live. For example, Little Rock hit 8th out of ten top cities in Nerd Wallet’s 177 cities with more than 150,000 residents; that ranking drew on 2016 Census data.
Little Rock hit number one on Kiplinger’s “10 Great Places to Live” list and 7th on their “Best Value City” list. A local military base can be a goldmine for real estate investors. Little Rock Air Force Base is located roughly 20 miles northeast of Little Rock.
This massive military base is the fourth largest employer in the state, and it brings thousands of renters to the Little Rock housing market. The military base itself employs around 30,000 people.
Let us know which real estate markets you consider best for real estate investing! If you need an expert investment advise, you can fill up the form given here. One of our investment specialists will get in touch with you. Norada Real Estate Investments helps take the guesswork out of real estate investing. We can help you succeed by minimizing risk and maximizing profitability of your real estate investments.
Let us know which real estate markets you consider best for real estate investing! If you need an expert investment advise, 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, the Norada Real Estate Investments makes no claims or assertions about the future housing market conditions across the US.
Large rental market
Low cost of real estate
The military market
Low property taxes
Market Prices, Trends & Forecasts