Phoenix real estate market has been hot, does that mean another crash is coming? I have received this question probably a dozen times in the last 5 years. The answer is no.
So why does the Phoenix real estate market seem so hot right now? There are a few reasons that are contributing to this. Big speculation is over the boomerang buyers who had foreclosures 7 years ago, and short sales 4 years ago coming into the market. And while that may be a small factor, there are other contributing factors.
One reason the market has had good growth is because Phoenix continues to be a place people want to live. According to the latest census information, the Phoenix area has had the second largest increase in population in a year only behind Houston.
Phoenix has had great growth in the east valley with new high tech companies moving into the area. With the combination of the high tech job growth, a strong economy, reasonable tax rates, and some of the best communities around like Eastmark and Carino Estates, Phoenix will continue to grow.
Looking at demand you would expect it to be way up over normal. But according to the Cromford Report, demand is pretty close to normal, the big change in the market is the inventory is lower than usual.
Over the last year we have had several communities like Phoenix and Tempe have great growth, in the 7-8% range. While other Communities like Chandler, Gilbert and Mesa are in more of the 3-5% growth range.
So while we have had growth, it has been nothing like a 20-30 or 40% growth jumps that really give you pause to consider what is going on in the market.