Supply in the Phoenix real estate market is not yet back to normal, but it is clearly getting much stronger. Demand, meantime, has cooled as investor interest wanes and ordinary homebuyers hang back. If this shift continues, the market could be in balance by year’s end, according to Mike Orr, author of the Greater Phoenix Housing Market Report and director of the W. P. Carey School’s Center for Real Estate Theory and Practice.
Historically, the heat of summer wilts the Phoenix housing market, a phenomenon reflected in the June housing report from the Center for Real Estate Theory and Practice at the W. P. Carey School of Business. Mike Orr, director of the center, says that prices tend to stay put or even drift downward during the summer doldrums. This year prices may be sliding sideward, and Wall Street is focused on the rise in interest rates. But pay no attention, Orr says. The long term trend will hinge on the major factors, which are population growth versus housing supply.
Some real estate commentators are making ominous predictions that the market is once again inflating like a bubble. But Mike Orr, director of the Center for Real Estate Theory and Practice at the W. P. Carey School of Business, says there is no evidence in the data to support their assertions. Similarly, history shows that rising interest rates do not deflate buyer interest. Listen to this seasoned expert explain in this conversation about the latest Greater Phoenix Housing Report.
Rumblings in the media hint that rising home prices could be the start of a new bubble, but real estate expert Mike Orr says that researchers who are examining the data don’t believe it. Instead, he says Phoenix is experiencing a market come back. The market continues to be complex, however, with supply constrained and the homebuilding industry cautious. Based on March data for land transactions, the hot area for homebuilding is likely to be Southeast Gilbert, Southeast Mesa and Queen Creek.
Although many people may find it hard to believe, the Phoenix area is facing a growing housing shortage, according to real estate experts Mike Orr and Mark Stapp from the W. P. Carey School of Business, who were featured speakers at a forum on April 6. And, the future may bring more dense developments and urbanization of the suburbs.
Each year Urban Land Institute Arizona presents “Trends Day” — a major event designed for professionals in the real estate and development industries — to inform and to spark discussion about current conditions and the latest thinking in planning, design and development. This year’s theme, apropos of the economic recovery, was “The Way Forward: Emerging Trends in 2013.” The Master of Real Estate Development program maintains close ties with ULI and other industry organizations. At Trends Day, KnowRE sought out leaders of ULI Arizona to explain what the organization does throughout the community.
