Phoenix home buyers are among the growing numbers of Americans buying bigger and pricier homes. But the reasons why might actually have more to do with the current market than growth in wealth.
Erica Luna of Century 21 Northwest Realty says while the Phoenix market appears to be rebounding well from the financial crisis of 2008, inventory for single-family homes remain low and continues to play a significant role in the pricing of a home.
“As a result, there will be some homes where an individual will be paying more for the square footage,” said Luna. She adds, however, that statistics also show potential buyers are “looking for homes that are comfortable and has size and room to grow.”
The National Association of Home Builders recently released data showing the the average size of a single-family home climbed to about 2,720 square feet in 2015 from 2,660 square feet the year before, and that the average price of new homes for sale in 2015, climbed to $351,000 — up $100,000 from 2009.
Adding to the upward trend, builders too have been primarily focused on constructing homes toward the higher end while many first-time, often younger, potential buyers continue to struggle with the down payments and mortgage approvals necessary to enter the housing market. That puts many potential buyers in the position of having to seek out existing homes and that too can present similar challenges with the fulcrum of scarcity and price.
According to Luna, single family homes with three-to-four bedrooms sold in the $200,000 to $250,000 price range between 2014 and 2015, continuing a slow but steady trend upward in both sales and cost in the Phoenix area.
While builders and lenders continue to explore ways to entice younger buyers into the market, Luna says it’s also important that buyers and sellers stay open to negotiation in the current housing climate.
“For a seller, it is important to get the most for their home but to also ensure the home is not priced too low nor too high,” which could result in the house sitting on the market for a long period of time.. Luna also cautions that buyers should be responsible in the purchase of their perfect home and to consult with a Realtor that represents their best interests in the negotiation process.
– Suzanne Wilson, Phoenix.org