IRVINE AND SILICON VALLEY, CALIF. – October 11, 2016 – Ten-X, the nation’s leading online real estate transaction marketplace, has released its Second Quarter 2016 Economic and Single-Family Housing Market Outlook Report for Phoenix, which reveals that the metro’s homeownership rate rose to 63.4 percent, meeting up with the national average for the first time since 2010 as home prices in the area continued to rise.
“Phoenix continues its remarkable recovery from the volatility of the housing market boom and bust cycle, where it was one of the hardest hit cities in the country,” said Ten-X Executive Vice President Rick Sharga. “The city’s strong underlying economic fundamentals – high employment, growing wages and increasing population – bode well for continued growth in the housing market.”
Existing home sales in Phoenix rose to a seasonally adjusted annual rate (SAAR) of 123,600 during the quarter, a 12.5 percent year-over-year increase, hitting a new cyclical peak, and surpassing the national average for the first time since early 2015. Available inventory of homes for sale in Phoenix remained tight, even with a 7.2 percent uptick from a year ago, while the average time a home for sale sat on the market rose to a seasonally adjusted 61 days. New home construction remained weak, with both housing starts and permits down on a year-over-year basis, and lagging well below historical levels.
Home price appreciation slowed down slightly in the second quarter, but the metro still outpaced the national average, pushing the median existing home price in Phoenix to $222,194, 8.4 percent higher than a year ago. Prices remained well below the metro’s prior peak, suggesting additional room to grow.
“Compared to other major metropolitan areas, Phoenix real estate remains relatively affordable, even as prices continue to rise,” noted Sharga.
Economic and Demographic Fundamentals
Phoenix’s economy continued to perform well in the second quarter of 2016 as key sectors such as Financial Services and Professional/Business Services exhibited solid growth, pushing total employment up 3.2 percent year over year to reach an all-time high. Unemployment fell 10 bps from a year ago to 5.1 percent, continuing to hover near the national rate.
Phoenix’s demographic picture remains strong, having outpaced the U.S. population growth over the past 20 years. The metro added 87,988 residents in 2015 measuring a 2 percent year-over-year increase, with domestic in-migration accounting for more than half of the population increase as Phoenix’s strong labor market attracted domestic workers. On potential issue for continued housing market growth, however, is that Phoenix’s total population includes above average proportions of residents under 24 years old and over 65 years old, lagging the national average in age brackets between 25 and 64 years old, which are typically a consumer’s prime home buying years.
Ten-X is the nation’s leading online real estate transaction marketplace and the parent to Ten-X Homes, Ten-X Commercial and Auction.com. To date, the company has sold 244,000+ residential and commercial properties totaling more than $41 billion. Leveraging desktop and mobile technology, Ten-X allows people to safely and easily complete real estate transactions online. Ten-X is headquartered in Irvine and Silicon Valley, Calif., and has offices in key markets nationwide. Investors in the company include Google Capital and Stone Point Capital. For more information, visit Ten-X.com.