First-time home buyers are noticing some challenges — as the entry level housing market is getting more and more competitive.
Valley's average home prices rose 10 percent in three months
The Phoenix area is the top market in the nation for gains in housing prices. The real estate tracking firm Clear Capital says the average price in the Valley rose nearly 10 percent in just the last three months. From Phoenix, KJZZ’s Terry Ward reports.
TERRY WARD: Home values are up 9.4 percent for the quarter but that follows the steep declines we’ve seen since the market crash beginning in 2006. Clear Capital analyst Alex Villacorta says first-time homebuyers and investors are snatching up homes in the lower price range. And he says that demand is putting upward pressure on prices.
ALEX VILLACORTA: Oftentimes double-digit growth. And Phoenix is one area where homes are ideal for first time buyers with affordability being so high and interest rates so low. So those two factors are making those low-end properties so attractive.
WARD: Clear Capital defines ‘low-end properties’ as those priced under $140,000. Villacorta says there’s plenty of room for price increases in light of how the market has performed in recent years.
VILLACORTA: If you look back to where they’ve come from, prices are still down 57 percent from where they were in 2006. So even with double-digit growth, we’ve still got a long way to go.
WARD: Villacorta says he expects the Valley will continue to see price increases through this year. He’s predicting a leveling-off in price gains in 2013.