Another RECORD? No NOT that type of record that spins. Many home buyers have been sitting on the fence trying to time the market for the best home price and mortgage rate. Those that have put it off buying during the past 3 years have lost the opportunity to see massive appreciation with a home value expected to reach a RECORD median high price in May to $475,000 in the Phoenix Arizona metro area. Mortgage rates (30 years) have increased from 3.11% median in December to over 5% in May 2022. The time may be now to buy with further increases in home prices and mortgage rates forecast for 2022. Those that wait may look back in a few years and wish they had purchased this year. (Photo: Record Player Mgattorna Pixabay)
Per Catherine Reagor of the Arizona Republic on May 2, 2022, "Metro Phoenix home prices continue to soar to new records, and sales are climbing again.
The median Valley home price hit an all-time high of $460,000 in March and is expected to climb to $470,000 during April based on pending sales, according to the Arizona Regional Multiple Listing Service."
What is causing the continuing Home Price Increase in Phoenix?
Reagor continues, "Ruff ’s latest research shows these factors are behind the hot housing market, but some also could create bumps for it.
● U.S. consumer prices climbed 8.5% in March from a year ago and hit a 40-year high.
● The S&P 500 stock index is down 8.4% so far this year.
● Arizona’s unemployment rate dropped to 3.3% in March, the lowest rate in almost 50 years, according the Bureau of Labor Statistics.
● New home sales in metro Phoenix are down almost 12% from a year ago.
● Cash deals for homes jumped 30% during the first quarter of in 2022, compared with the same timeframe last year, according the Information Market.
● iBuyers Opendoor and Offerpad, also known as instant buyers because they do cash deals quickly and mostly online, purchased 1,160 Valley houses during the first three months of this year and sold 2,549 homes during this year’s first quarter.
● About 20% of the houses sold by iBuyers in metro Phoenix went to corporate buyers.
● Metro Phoenix led the U.S. among big cities with a 30.4% home price increase during the 12 months ending in February, according to Corelogic.
What can put the brakes on home sales?
Mortgage rates jumped during the past few months, something that could slow the housing market.
The average 30-year mortgage rate jumped to 5.1% last week, according to Freddie Mac. A year ago, it was 3.1%.
Two percentage points adds about $450 to the monthly payment on a $450,000 mortgage.
“This week, mortgage rates averaged five percent for the first time in over a decade,” said Sam Khater, Freddie Mac’s chief economist. “As Americans contend with the historically high inflation, the combination of rising mortgage rates, elevated home prices and tight inventory are making the pursuit of homeownership the most expensive in a generation.”
Continuing, "But Ruff said metro Phoenix home prices will continue to climb at least through June.
The Valley’s median could hit $475,000 in mid-May based on pending sales, according to ARMLS."
In summary, Metro Phoenix’s median home price should hit a record $470,000 in April and will likely increase to $475,000 by mid May (once final numbers come in).
Home prices have about DOUBLED since 5 years ago in the Phoenix Arizona metro including Scottsdale, per Catherine Reagor in the Arizona Republic on February 27, 2022
Photo: Home Equity and Selling Price increases from Pixabay
Median House Prices Last 3 Years in Phoenix Arizona Metro
$475,000 May 2022 (forecast from MLS contracts in system)
$470,000 April 2022 (Expected pending final numbers)
$460,000 March 2022
$450,000 February 2022
$427,000 December 2021
$333,000 December 2020
$290,000 December 2019
Current Homes For Sale (Detached Single Family) For Sale in Phoenix Metro
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Moving to Sunny Arizona
"The Valley is drawing many new residents from higher priced areas who can pay the rapidly rising prices....Many of the people moving to the Valley are coming from San Francisco, Los Angeles, Chicago and New York where home prices are much higher." Currently we have the demand for homes in the Phoenix metro but the supply of individuals willing to sell their homes is low. Until the supply equals the demand home prices are expected to rise as long as people can afford to buy the homes.
Are you ready to move...think about the sunny Phoenix metro in Arizona? Yes prices are on the rise but rising mortgage rates are still closer to historic lows at 5.1% than highs. Both home prices and mortgage rates are expected to rise further in 2022.
Living in the Phoenix Metro Area including Scottsdale
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