Laveen South Phoenix Market Update March 2022
– As of March 9th 2022, the number of available homes for sale has come down from December of 2021 in the Laveen-South Phoenix area. Currently, the number of homes available for sale in Laveen is 67 compared to 108 last quarter and is trending downward as out of state buyers get ready for the summer home buying season. Phoenix has remained one of if not the hottest destination for out of state buyers and does not seem to be slowing down. The bottom line is that population will continue to increase in Arizona while the available land decreases. More condos/apartments would need to be built to keep up with the growing demand. There are still certain cities such as Coolidge, Casa Grande, Eloy, Florence and Arizona City with “affordable” new homes around the 280-350k range. If you do not like the idea of being 1 hour away from Phoenix, well you’ll hate it even more when the same houses in South East Arizona in those cities are pushing past 400k next year. It will take a few years for supply to catch up with demand across the U.S as the country is short millions of homes, supply constraints have not gotten better for any industry and the war may cause greater supply issues and inflation even though interest rates have gone up drastically from around 2.5% last quarter to now hovering around 4%.
– The best advice I can give is if you are planning to buy and don’t have the proper finances in place, then it may be a good idea to pool family or friends incomes together to purchase a house in one of the more affordable cities. Once you get your foot through the door, you immediately start building equity and increasing your net worth. Then before the market starts slowing down in a few years with more supply of homes, you can sell your home as an exit plan and then move back closer to the Phoenix area with more funds and greater purchasing power. You also have the option of purchasing a house now, living in one of the bedrooms and renting out the other bedrooms for $700-$1000/month to help pay for the mortgage. 90% of millionaires become millionaires through owning real estate such as houses, multifamily or commercial. I can tell you for a fact that you don’t want to be in retirement age collecting $1500/month in social security and not owning a piece of land while trying to pay $3000/month in rent. Even people who purchased houses before the 2008 crash have homes now that have doubled in value with 100s of thousands of dollars in equity that they can cash out at any time while paying $800/month for their mortgage while others are paying $2,500/month to rent the same home. If you were in a boxing match with inflation and don’t own assets, you will lose every time. You can never beat inflation which is why people who own assets such as land, businesses, commodities are well off even during economic recessions. The gap between the top 5% and bottom 95% has increased by ten fold over the last 4 years. Large investment firms have continued purchasing homes to rent out while also controlling and profiting off stock market swings and inflation while the middle class has had to deal with the blunt of inflation including rising rent.
The term gentrification means pushing out middle class folks in a certain area and replacing them with wealthier folks. It is never used to describe an entire state but I am here to tell you that will change. This term is usually associated with certain cities such as Harlem but with the new age of work from home, the entire state of Arizona will be gentrified. Similar to how homes in California and NYC rarely come down in value, there is a good chance homes in Arizona may never come down in value if over 100,000 people continue to move here every year. The natives of Arizona who can’t afford to stay here anymore will look towards more affordable states such as New Mexico, Texas, Alabama, North Carolina, Louisiana, Ohio, Michigan, Indiana, Upstate New York etc or even outside of this country such as Mexico or the Philippines.
- Average list to sales price in South Phoenix is over 100% thus on average, every home that is listed is sold above asking price which means homes are not being listed at accurate prices. For example, if the past sales data gives your home an estimated value of $350,000, you would not list it at $350,000 because the market is still pushing upwards and it is a 100% guarantee that you would receive multiple offers well above asking price within 48 hours so instead, you should list it at $375,000 to begin with as a starting negotiation point and be more aggressive with your pricing especially towards summer. Once you set a price above past sales data, you will want to seek out quality offers such as ones with an appraisal waiver. Another point to make here is that you will want to look at your competition as in other houses being listed within 5 miles to see what inventory is available. As the market continues to push upwards, you definitely do not want to be the cheapest house on the block but you also don’t want to be the most expensive house unless certain features and upgrades of the home call for that. Setting a price point some where in the middle with the proper marketing will allow you to get the best offer in a reasonably fast time period. You should also review offers to see if it is an investment firm or a family making the offer as you may prefer to have a family purchase the home over an investment firm.
- The median monthly sales price in South Phoenix is around $415,000-$450,000.
If you need help with anything, you can call/text me at 480-779-8579 or email me at [email protected] Good luck. S.L Taxes & Real Estate is the best real estate, tax preparation and accounting business in the Laveen, Tolleson, South Phoenix Arizona area.