September Real Estate Market Updates for Arizona

As of the end of September 2024, the Arizona real estate market remains strong but faces a few notable challenges. Here's a breakdown of the key trends:

1. Limited Inventory: Across the state, especially in Phoenix, there is a shortage of available homes, continuing to drive up prices. This low inventory keeps the market highly competitive, benefiting sellers. Buyers need to act quickly and be prepared with their finances in order to secure a home​

   
   

2. Interest Rates and Affordability: While interest rates have somewhat stabilized, they remain elevated, with 30-year mortgage rates around 6%. This is making it harder for first-time buyers to enter the market, particularly in the Phoenix area. However, experts predict that rates could drop further by the end of 2024, potentially down to 5.5% in 2025, which may relieve some pressure on buyers​

   
   

   
   

3. Home Prices: Median home prices in Arizona are still relatively high. For example, Phoenix saw a slight dip in prices in September (0.4%), but prices are expected to recover in 2025. Tucson and other areas like Flagstaff are experiencing similar trends, with minor price decreases followed by potential stabilization or growth in 2025

   
   

4. Population Growth and Job Market: Arizona, and particularly the Phoenix area, continues to attract new residents, bolstered by job growth in industries like tech and manufacturing. This steady influx of people continues to drive demand for housing, even as interest rates rise​

   
   

   
   

Overall, while the Arizona market remains favorable for sellers due to low inventory and strong demand, buyers may find it challenging due to high home prices and interest rates. However, the outlook for 2025 suggests a possible easing of these conditions.