It’s no secret that the real estate market has had its ups and downs since the onset of the Great Recession. Markets in some parts of the country have rebounded, perhaps in some cases to pre-recession levels. “Hot” spots, particularly in or around major cities with booming job growth and employment centers, have enjoyed at times flourishing market performance quite rapidly. Other areas however, have experienced more modest growth, which some experts argue may prove healthier and more sustainable in the long run. Over the last several years, that seems to be the case with the market in Southern Arizona.
By comparing market performance year over year, we can see an upward trend in both the selling prices of existing homes and the average price per square foot (both of which are indicators of positive growth). The low market home values of the recession have gradually increased, and owners are increasingly less burdened by owing more on their home than it is worth. For example, in Pima County, the average closing price and price per square food have increased 5% year over year (from $265,467 to $278,670 and $133.36 to $140.64, respectively).
In the greater Sahuarita area, the market is even better; where the average closing price for home sales has increased 9% ($214,444 to $232,251) year over year. This market has also experienced a 7% increase in the price per square foot ($108.00 to $115.83). Homes in the community of Rancho Sahuarita, which accounts for a large proportion of the population in Sahuarita, has seen a 6% increase in average resale price, and 5% increase in the price per square foot. The sales of distressed homes in Sahuarita, and particularly in Rancho Sahuarita, are also down year over year, another sign of market health.
Sales pace over the last few years has proved to be less aggressive, as issues with inventory in the greater Southern Arizona market have held back the number and frequency of those sales. However, local homebuilders are still building, aiming to recapture a more significant proportion of home market share with new homes. The lower availability of resale home inventory will likely aid in this process. With the opening of new neighborhoods in communities like Rancho Sahuarita to meet the needs of move up and first-time buyers, permits have increased greatly year to date (133%) (when compared to the same timeframe last year). However, permit activity in Pima Country as a whole through the month of April is down 1.5%.
As 2019 progresses, and with a fair amount of cautious optimism amongst experts, it will be interesting to see whether these trends continue and how the local Southern Arizona market, and the Sahuarita market in particular, perform.
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