The home-buying market in the Phoenix area is still "quiet," but the same can't be said about rentals.
According to the monthly real estate report from Arizona State University's Center for Real Estate Theory and Practice, the rental supply in the Phoenix area is at "unusually low levels" due to a heavy demand.
"In addition the supply of single family rentals is dropping much faster than apartments, condos and townhomes," the report states. "The supply of single family rentals is now well under 1 month."
This isn't particularly surprising. Previous months' reports have explained that Millennials -- as well as anyone who lost their home in a foreclosure or short sale -- aren't buying homes. You're undoubtedly familiar with some of the reasons why Millennials don't buy homes, as has been explained in countless media reports on the topic: a higher burden of student-loan debt, a preference for urban living, an appreciation for the flexibility of a rental, being turned off by the mortgage crisis, in addition to several other factors.
"The average time on market for a leased home (excluding vacation rentals) fell to 50 days, down from 53 days last month," this month's report says. "With this fast turnover and low vacancy rates, it is likely that rents will increase in the most popular locations."
The report also suggests that some Baby Boomers and Gen-Xers don't want to give up the low interest rate on the mortgages they have, so they may be more inclined to just rent out their home instead of selling it when looking to move. Baby Boomers and Gen-Xers represent most of the demand for home-buying in the Phoenix area, the report states.
That demand's still low, and the latest available stats on the market, from February, support the prediction made in last month's report -- home prices may not appreciate at all for a majority of the year.
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"However the Phoenix market is highly volatile and nothing is certain," the report notes.
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