Like most of the rest of the nation, Arizona's real estate market suffered when the property bubble burst in 2008. Slightly more than a decade after the Great Recession, however, the real estate market in the state is thriving and expanding again. Investors in the construction business and property markets are taking note.
According to various experts, the boom in new construction and the rise in existing home values have been spurred on by Arizona's tech boom. Corporate relocations and expansions, coupled with higher wages, has increased the demand for housing in general and pushed prices skyward. For example, the median home value for Phoenix has risen a remarkable 5.5% over the past year -- and are anticipated to rise another 2.6% by early 2020. Tempe and Chandler are also considered hot spots for the recent boom.
Rents are also going up in the state. Like many sunbelt cities, Phoenix rents have increased drastically. The average rental in the metro area is now $1,545 per month, an increase of 6.9%. In Rio Vista, the rents have soared an amazing 20.8%. This is particularly significant when compared to the modest 3.2% increase in average rents across the nation.
All of this news is great if you're a property owner who is looking to sell or an investor who is considering putting their money in property or construction. As one source stated, "While the summer is only beginning in the Valley, smart investors are already finalizing their plans for the rest of the year and making decisions to prepare for 2020."
On the other hand, investors and property owners alike should keep in mind that the hot market can lead to rash decisions -- which can ultimately lead to real estate and construction disputes down the line. Before you sell or invest, make sure that you consider all the pros and cons of the situation.