Housing Update
October 2022
MAG has compiled a variety of data sources and analysis on the topic of housing and affordability in the Phoenix-Mesa-Chandler Metropolitan Statistical Area (Phoenix MSA) region.
Below are the highlights from the latest housing update as of October 2022. This analysis will be updated as new data becomes available.
Construction and Developments
The housing industry changed after the 2008 recession. This chart shows the total number of residential units that were built in Maricopa County each year since 2000. In the early 2000s, an average of around 40,000 per year were built, with a peak of 48,000 in 2005. After the recession, the number units built dropped to 6,600 in 2011 and has been increasing since then, reaching just under 28,000 units in 2021. From 2000-2010, there were 389,400 units built. The total number of units built dropped by about 43% in the past 11 years – from 2011-2021, with only 222,800 units built.
This chart focuses on the number of apartment units built per year. There is a similar pattern to overall units built (above), but still slightly different for apartments. After a low of 230 units in 2011, the number of apartment completions increased and recovered to about 7,000 each year since 2015. The amount of apartments being built in the past two decades stayed fairly constant, 63,100 from 2000 to 2010, 60,800 since 2011. With the reduction in total completions over the last decade, the share of apartment units built has increased.
Residential vacancy rate has decreased by more than half since 2010. This chart shows overall vacancy rate above each bar. The gray part of each bar shows the seasonal rate while the blue part shoes the resident vacancy rate, excluding seasonal units. Resident vacancy rate has dropped from 12% in 2010 to only 5% in 2020.
Residential Sales
Median sale price in the Phoenix MSA has increased 33% since 2020. The teal line shows September 2021 to September 2022 and the gray line shows September 2020 to 2021. Year-over-year from September 2021 to September 2022 there was a 7% increase in median sales price. Median sale price for single family units is higher, around $500,000. Since June 2022, median sales price has declined from a high of $475,000 to $435,000.
Over the past few months, the housing market seems to be correcting from its high points over the summer. Total inventory listed for sale has gone up 93% in the past year, while the average number of days on market has increased from 30 to 48 days.
27% of sales across the region were paid for in cash in August 2022. Over the past 5 years, an average of approximately 25% of sales were cash. These cash sales put upward pressure on housing prices. In areas of poverty 25% or more, 26% of sales were cash.
26% of the housing stock in the region (approximately 364,000 units) is either seasonal- or investor-owned. This map shows properties owned by people outside of Arizona and outside of the U.S. 42% of properties are owned by people out of state. Top 5 states in which out-of-state owners reside are California, Washington, Texas, Illinois, and Colorado. 4% of the housing stock are owned by international owners, most commonly from Canada.
1.2% of housing stock in the Phoenix metro area (approximately 23,000 units) is short-term rental. Within the Phoenix metro area, Paradise Valley has the highest percent of housing stock being used as short-term rentals (5.9%), followed by Scottsdale and Cave Creek (both 4.3%).
Statewide, 1.4% of housing stock (42,000 units) is short-term rentals. Sedona has the highest percentage of housing stock being used as short-term rental (27%).
In the Phoenix MSA, sales transactions under $300k have decreased by 75 percentage points since 2011. This chart shows the number of sales transactions by price. There have been very few transactions under $200,000 the past several years. Sales under $300k (dark blue and green bars), have dropped from 90% in 2011 to 15% in Q1 2022.
From 2017-2022, median sale price increased 93%, but in areas of poverty there was a 126% increase. This map shows change in sale price geographically – darker blue navy areas represent where there was 130% or more increase in median sale price. The overlayed orange dashed areas show places where 25% or more of the population is below the poverty line. These areas with higher poverty saw a larger increase in median sales price.
In the Phoenix MSA, availability of apartment units with rent under $1,000 has decreased significantly since 2010. This chart shows apartment rent over time by cost. The darker blue represents apartment units with rent under $500, which dropped from approximately 20% in 2010 to virtually none in the past few years. Units with rent under $1000, the light green and dark blue parts of the bar together, have dropped from over 90% in Q4 2010 to only 10% as of Q1 2022.
Newer apartments (post-2018) are charging 25% higher rent than all other existing apartments. Apartment rent on a per square foot basis is higher for apartments built since 2018 than all apartments.
Since 2017, apartment rent has gone up 68% in the Phoenix MSA. This map shows rent change for apartment complexes with 50 or more units. Green dots represent complexes with a rent increase of up to 50%; orange and red dots represent complexes with a rent increase of 75% or more. As of the first quarter of 2022, median rent is $1,580 in the region.
Evictions and Cost Burden
Cost-burdened households are households paying 30% or more of their household income on housing costs, whether mortgage or rent. This map shows percentage of households paying more than 30% in different areas across the region. In areas with darker red, more than 45% of households are spending over a third of their income on housing expenses. Across the Phoenix MSA 518,000 households are cost-burdened and 230,000 households are severely cost-burdened, spending more than 50% of their income on housing. A significant majority (93%) of cost-burdened households have a median income below $75k.
Multi-family renter households have the highest percent of households that are cost-burdened. This chart shows cost burden by household type. 30% of total households are cost-burdened. The group with the lowest percentage of cost burdened households is households that own their home. Renter households have a higher likelihood of being cost-burdened. 39% of single-family renter households are cost-burdened, while 50% of multifamily renter households are cost-burdened.
Looking at workforce and affordability, some occupations are more likely to be cost-burdened. While the region’s economy is growing and attracting businesses, the region still needs to grow service sector jobs to support the region, such as Food Preparation, Building and Grounds Maintenance, Healthcare Support, and Personal Care and Service. In households that are anchored by these support occupations the annual median income is between $39,000 to $50,000. The maximum monthly rent or mortgage payment these households could afford without being cost-burdened, is $990 to $1,250. Analysis shows that 43-50% of these households are cost-burdened.
Census Household Pulse Survey data shows that 65% of renter households with income less than $50,000 had a rent increase, and 18% of renter or owner households making less than $50,000 are behind on rent/mortgage.
(U.S. Census Bureau, Household Pulse Survey, Week 46: June 1-13, 2022)
Maricopa County eviction filings have increased 22% from January 2020 to August 2022. Pre-pandemic, monthly evictions filings were around 5,000 (seen in gray on the chart above). The teal bars show how evictions were affected by the pandemic and eviction moratoriums in place at the time. The major dip was in April/May of 2020, but evictions started to increase again shortly thereafter, and has continued to increase, reaching 6,500 in August 2022. Monthly eviction totals are now higher than pre-pandemic numbers. 72% of evictions are in lower income areas (see map below).
Explore More Data
The Regional Analytics Division has a variety of additional data, maps, and tools available at the following links:
Contact us with any questions or feedback at [email protected].
Sales data is not available for this geography at this time
Median Sales Price in
Number of Overall Sales Transactions
Source: The Information Market
Note: A three-month rolling average was used for this analysis due to the smaller sample of sales transactions
Price Trends in
Source: The Information Market
Median Sales Price Comparison
Click on column headers to sort table by selected field.
Source: The Information Market
Notes:
- This analysis uses medians ("middle" value in the data) rather than calculating averages
- Data is shown where available, some geographies are excluded due to insufficient or missing data
- Analysis of Apache Junction and Queen Creek includes Pinal County portions, Wickenburg includes Yavapai County portion
- A three-month average was used for the following jurisdictions due to low number of sales transactions: Carefree, Cave Creek, Fountain Hills, Litchfield Park, Paradise Valley, Tolleson, Wickenburg, and Youngtown
Median Rent in
Source: RealData, Inc (50+ unit complexes only)
Note: Dashed line represents the overall median rent for selected geography
Apartment Rent Trends in
Source: RealData, Inc (50+ unit complexes only)
Rent data is not available for this geography at this time
Median Rent Comparison
Click on column headers to sort table by selected field.
Source: RealData, Inc (50+ unit complexes only)
Notes:
- This analysis uses medians ("middle" value in the data) rather than calculating averages
- Data is shown where available, some geographies are excluded due to insufficient or missing data
- Apache Junction and Queen Creek include Pinal County portion
Monthly Eviction Filings in
Source: Maricopa County Justice Courts*
Note: On this chart, gray represents pre-COVID numbers
Evictions data is only available for jurisdictions within Maricopa County
Click on column headers to sort table by selected field.
Source: Maricopa County Justice Courts*
*Note:The analysis on this tab only uses eviction filings with a valid address/location within Maricopa County; it excludes eviction filings with an unknown location
Distressed Properties in Maricopa County
Note: This tab cannot be filtered by geography and the chart will only show the total for Maricopa County.
Source: The Information Market
Notes:
- Foreclosure data not available for the Indian Communities; the Maricopa County portion of Apache Junction is also not included
- "Foreclosures" comprise all residential properties that have already been foreclosed and have not yet been purchased
- "Pending Foreclosures" are all residential properties that have received a letter stating the property will be foreclosed upon but has not yet been foreclosed
- “Distressed Properties" sum both "Foreclosures" and "Pending Foreclosures"