Why It’s So Expensive to Live in Phoenix

[MN-Born-n-Raised]

Originally Posted by TurcoLoco

Ha-hah, I am sure with that statement, you confused quite a few people that they couldn't figure out whether they like you or dislike you!

Here are the categories I no longer want to share any personal info on:
Politics, religion, social topics involving sex, abortion or vaccination.
I am neither that educated, interested and invested in any of these areas enough to care to talk.
Even the most civilized conversation about any of these topics is never likely to solve any issues and more than likely gain you new enemies/haters.

Simply put; my opinions/thoughts on these are nobody else's business.

I have plenty of thoughts about those topics. I don't mind sharing because I put many hours of thought into why I think what I think. Plus, I prefer hanging out with rational people. Politically, I'm right of center. It's easy to see why people are overly passionate on both sides. And any topic that is controversial has legitimate counterpoints. When you acknowledge that you agree with either line of thinking on your polarized list, intelligent people are not bothered.

[TurcoLoco]

Originally Posted by MN-Born-n-Raised

I have plenty of thoughts about those topics. I don't mind sharing because I put many hours of thought into why I think what I think. Plus, I prefer hanging out with rational people. Politically, I'm right of center. It's easy to see why people are overly passionate on both sides. And any topic that is controversial has legitimate counterpoints. When you acknowledge that you agree with either line of thinking on your polarized list, intelligent people are not bothered.

I like the way you think, and I am not against people who are passionate and inclined that share their well-formed opinions as long as they have done their research, possess common sense and do it in a civilized manner.
Typically, when people are talking about politics and religion, I noticed they typically seem to care only about what they say and not really open to input from others.
God forbid you feel like making valid or at least, logical counter points and they are almost looking at you like they only hear elevator music.
Even if they, by some miracle, acknowledge your response, they do not really evaluate it against their info or opinion. If you agree with their point, great. If not, good luck.

I, really, am not following politics nor am I interested in it. It is s.h.i.t. no matter how I look at it.
2-party Democratic system is a joke if you ask me. Not enough options. to break the balance or the consensual political reach-around that naturally forms with just 2 parties.

That said, I am not opposed to listening well-informed individuals making valid or logical sounding points, and both sides seem to have them. What baffles me is a well established movie star like Robert De Niro coming out to make a passionate interview to bash Trump because he thinks Trump is "evil".
Like Democrats and Democratic leaders are all angels!?

I think Jordan Peterson was right. The politics and political parties managed to divide this great country. Arguably better than any foreign enemy or threat ever could.

OK, I wrote all this to share my extend of knowledge on topic which is not much or saying much.

Final sentence is about the title of this thread "Why It's So Expensive to Live in Phoenix".
First of, I am thinking it reads more like the title of a blog and not like a question which it probably was meant to be.
Secondly, as others mentioned too; if the rest of the country and even the world has gotten expensive, it should not be shocking that Phoenix has, as well.

[PhoenixSomeday]

I don't think it's a stretch to say that COVID-driven remote work for 2 - 3 years (from 2020 on) made a large enough population of people leave high COL areas to make an impact on the housing prices in Phoenix. They sell their $2M house and drop $450k on a house being listed for $400k just so that they don't have to worry about a bidding war like the hot area they just left, then they have many hundreds of thousands left to do whatever. So now since that house "worth" $450k because an outlier paid for it (ignoring what the vast bulk of qualified and interested parties are capable of paying), the almighty "comps" start making people list their house higher than they would otherwise. Lockdown is over and remote work has dwindled somewhat, but, damage done.

[Potential_Landlord]

Originally Posted by PhoenixSomeday

I don't think it's a stretch to say that COVID-driven remote work for 2 - 3 years (from 2020 on) made a large enough population of people leave high COL areas to make an impact on the housing prices in Phoenix. They sell their $2M house and drop $450k on a house being listed for $400k just so that they don't have to worry about a bidding war like the hot area they just left, then they have many hundreds of thousands left to do whatever. So now since that house "worth" $450k because an outlier paid for it (ignoring what the vast bulk of qualified and interested parties are capable of paying), the almighty "comps" start making people list their house higher than they would otherwise. Lockdown is over and remote work has dwindled somewhat, but, damage done.

And I think we are not done yet. Interest rates falling are/will reignite the trend up. I think it is happening as we speak. Certainly unhealthy for some of the borrowers right now who stretch too far but happening. So many people held of purchasing after the rates increased so dramatically last 1-2 years, almost no transactions happening. But you can only wait so long as your life progresses (same with car purchases). I think we are right there now.

[wilberry]

and they are still building, completing these two-story large homes all over! who is buying? not Gen Z cant be ...

[Valley Native]

Originally Posted by PhoenixSomeday

I don't think it's a stretch to say that COVID-driven remote work for 2 - 3 years (from 2020 on) made a large enough population of people leave high COL areas to make an impact on the housing prices in Phoenix. They sell their $2M house and drop $450k on a house being listed for $400k just so that they don't have to worry about a bidding war like the hot area they just left, then they have many hundreds of thousands left to do whatever. So now since that house "worth" $450k because an outlier paid for it (ignoring what the vast bulk of qualified and interested parties are capable of paying), the almighty "comps" start making people list their house higher than they would otherwise. Lockdown is over and remote work has dwindled somewhat, but, damage done.

A home worth $450K is average at best anymore in the Phoenix market. Houses in some neighborhoods easily double that value, and people who moved here from CA or other expensive areas would consider anything under $1M a pretty good bargain. Also, bidding wars are a reality here. They don't just occur in the high cost states, which by the way are not so hot anymore. As far as working remotely: since the COVID scare tactics are behind us, most companies have requested (or even demanded) their employees to return to the office locations. It's completely different if you're self employed.

Originally Posted by wilberry

and they are still building, completing these two-story large homes all over! who is buying? not Gen Z cant be ...

When there is demand, of course building will occur. Phoenix is an active market, and many of the buyers are here from expensive places like CA. Although, I'm seeing more newer apartment buildings under construction than I am SFHs.

[MN-Born-n-Raised]

Originally Posted by wilberry

and they are still building, completing these two-story large homes all over! who is buying? not Gen Z cant be ...

At least some are "Build-to-rent." PHX is leading the country in that category. Also, the cost per square foot of a single level costs more than a two-story. As a side note, with all of these small lots, having large two stories on them ruins the look and feel of the area. YMMV.

"Built-to-rent properties took off in Phoenix in 2016 when big home builders saw the potential to pull younger families into their communities with a rental product. Their goal was to eventually sell these renters a home in the same neighborhood when they could afford it."

[grmi66]

Originally Posted by wilberry

and they are still building, completing these two-story large homes all over! who is buying? not Gen Z cant be ...

My children are at the front end of GenZ, the oldest being 26. Until he gets married and settles in someplace he won't be buying a house and he's further along in a career than most his age. GenZ won't impact the housing market for at least 5 years in my opinion.

[Potential_Landlord]

IMO the best predictive rent index for single-family rentals is the CoreLogic SFRI. This one has been re-accelerating for ~a year. This means limited hope for lower SFH rents and thereby also higher CPI readings as the CL SFRI predicts the OER part of the CPI by ~8-9 months. Higher CPI would also mean interest rates remain higher vs. market expectations. I do believe in lower CPI and IR for the next few months but not to the extend most think. So things aren't getting cheap here.
https://www.corelogic.com/intelligen...ex-april-2024/

[wilberry]

Originally Posted by Potential_Landlord

IMO the best predictive rent index for single-family rentals is the CoreLogic SFRI. This one has been re-accelerating for ~a year. This means limited hope for lower SFH rents and thereby also higher CPI readings as the CL SFRI predicts the OER part of the CPI by ~8-9 months. Higher CPI would also mean interest rates remain higher vs. market expectations. I do believe in lower CPI and IR for the next few months but not to the extend most think. So things aren't getting cheap here.
https://www.corelogic.com/intelligen...ex-april-2024/

I agree with every acronym stated .........