September Real Estate Update From Lorelei Carter

Phoenix Home Prices: How Population Growth Spurs Record Prices, Rents

Street Scout

By Catherine Reagor| August 22nd, 2021

Metro Phoenix home prices and rents keep climbing, and here’s a big reason why.

Phoenix drew a higher percentage of new residents than any other major U.S. city between 2010 and 2020, according to the latest census data released last week. And West Valley suburb Buckeye grew more swiftly than any other city in the country.

The heady growth explains why the Valley’s median home price hit another record high in July, single-family home rents climbed higher here than anywhere else in the U.S., and apartment rent hikes during the past year are second only to Boise, Idaho.

Economists and housing market watchers have been citing metro Phoenix’s population growth as the driver behind the area’s rising housing costs for the past few years. The new census data proves it.

Growth, Growth, Growth

“The growth the census data demonstrates comes as no surprise. We’ve long known that Phoenix is a top destination to live and work,” Phoenix Mayor Kate Gallego told my colleague Geoff Hing.

Hing’s analysis of the census data shows Phoenix grew by more than 160,000 people from 2010 to 2020, an increase of 11.2%.

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Are Home Updates Actually Worth It Right Now?

Housingwire

By Jordan White | August 27, 2021

Should you update your home before putting it on the market? Three in four homeowners say they’d rather replace their appliances than accept a low offer on their home, according to a study by Cinch Home Services.

Cinch Home Services surveyed over 1,000 homeowners and renters to figure out how important updates are in the homebuying process. And they discovered that a majority of homeowners think upgrading their appliances will increase their home value by almost $14,000. Due to this ideology, over half of homeowners plan to upgrade their appliances before putting their homes on the market. Almost 60% will repair or replace their air conditioner, almost 46% will prioritize their dishwasher and about 40% will take a close look at their water heater.

Examine Return On Investment

Unfortunately, upgrading your appliances won’t necessarily allow for a huge return on investment. While upgrades can make your home more desirable, you may not completely recoup the cost of what you spend. Take major kitchen remodels, for example. According to 2021 research, the average cost to remodel a kitchen was around $75,000. This included upgrades like a built-in microwave, dishwasher, custom lighting, etc. But even with these changes, that only added $43,000 to the resale value and the cost recouped was about 57%.

On the other hand, a simple garage replacement costs on average about $4,000 and adds about $3,000 to the resale value, bringing the cost recouped at $94%.

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