Phoenix metro housing market is relying on out-of-state buyers
Buyers are coming from Seattle, Los Angeles & San Francisco
PHOENIX (3TV/CBS 5) — Look around the Phoenix metro area, and you’ll see homeowners are still selling. People are still buying, but the market has definitely slowed down.
“Yeah, there’s really no incentive to sell right now. Because even if it’s a lateral trade you have to go with a higher interest rate, so you have people hoarding their homes right now,” John Sposato told On Your Side. Sposato has been selling homes for more than two decades and says the Phoenix real estate market is being kept alive by out-of-state buyers.
On Your Side caught up with Sposato as he was driving to show homes to a Seattle couple. “I’m working with buyers and showing homes. I’m showing two homes right now. We’re headed to another home now in the Southeast Valley.” According to RedFin.com, which tracks real estate transactions, most Phoenix homebuyers last month moved from Seattle, Los Angeles, San Francisco and Chicago.
“Companies are coming here and building factories,” Sposato said. “We’ve got semi-conductors, we’ve got Google, we’ve got Amazon, we’ve got Apple. I mean, we have a lot of jobs coming to Phoenix.” On Your Side asked Sposato if these out-of-state buyers were paying in cash. “There are some buying for cash, there is no question,” he replied. “They’re selling their homes in California and they’re coming here where they’re finding homes a lot more affordable.”
While out-of-state buyers are gobbling up homes, there aren’t many to choose from. In fact, six months ago there were 19,000 homes for sale in the Phoenix market. Today, there are only 11,000 for sale. Sposato and other realtors say you can attribute that to the higher interest rates. “When interest rates start to come down, I think more sellers will have an incentive to put their homes on the market and that means there should be more for the buyers to choose from,” he said.
That could happen in the fall, but of course no one has a crystal ball. By the way, last year the median Phoenix metro home sold for $480,000. Today, it’s only $435,000.
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