Arizona’s housing market cooling down
The Arizona housing market is showing signs of cooling down after a long period of skyrocketing real estate.
On Horizon is Mark Stapp, a professor at ASU’s W.P. Carey School of Business, to talk about the situation.
With inventory increasing and sales decreasing, there’s definitely a cooldown. The past year saw the housing market increased by almost 33%. But due to a number of factors, cooldown has been prevalent.
“We see it in the reduction in the median sales price of homes. We certainly see it in mortgage interest rates having an effect on people’s ability to afford houses so it’s definitely cooling.”
With the new signs of the market cooling down, there are a number of factors playing a part in how much of a decrease will be seen.
Interest rates have been going down, therefore, people are looking to come back into the market and purchase homes. Stapp tells Horizon that with this decrease, a psychological aspect plays a part.
“People who can afford that are thinking about it, are thinking do I fall further, do I continue to wait?”
Pressure on housing
When it comes to the different types of homes available, how does the cooling of the market affect them? Well, multi-family homes saw much pressure with the increased housing market. But with increased inventory added to the marketplace, that pressure has seen some slowing down.
But with the metro area seeing an increase in population, the number of houses and housing available is limited. And as such the regular balance of supply and demand in the market is not prevalent.
“As long as we continue to have that kind of economic expansion and population growth, it’s going to keep pressure on housing.”
While the increased pricing in the housing market made it popular with sellers, making it a “seller’s market”. But Stapp says that now we are seeing a more balanced market.
But even though that may be the case, finding affordable housing at a decent price point is difficult to find.