Additionally, the pandemic has caused significant and abrupt changes in the needs of homeowners. The shift to remote working has homeowners adding home offices to their list of must have criteria when purchasing. People are more increasingly looking at single family homes versus condos/townhomes with limited outdoor space. Cutting the leash from offices has also given the freedom to move out of more densely populated locations like California to less populated and less expensive geographies like Central Arizona. As we get an influx of out of state residents, we will continue to see tightness in the housing supply and thus prices continue to rise. 

This begs the question, when will we see some alleviation in the housing supply? Homebuilders are working feverishly to add more houses to Central Arizona, but we are still a few years from being caught up from the 10 year hiatus in building that started with the 2008 housing market crash. Building permits are up 21% since 2019 and have returned to the level of 2006 before the crash. With average build times of 10-14 months we will start to see this housing supply come online towards the latter part of 2021. Will it be enough to push us back to a more balanced supply? Likely no, but it will certainly help.

If you want to hear more about how the housing market performed in 2020 and my predictions for 2021, stay tuned for my Year End Market Update coming in mid-December. 

Lindsay Fricks, Helping you, your family and friends Live & Love in Arizona.