Updated almost 4 years ago on . Most recent reply
Phoenix Metro Homes Among Nation’s Most Overvalued, Study Finds
The Phoenix housing market has become overpriced.
That’s according to a recent study from researchers at Florida Atlantic University and Florida International University.
The research found that homes in various metro areas are substantially overvalued with a low supply of houses on the market. It found that four U.S. housing markets are overvalued by more than 60%. Meanwhile, homes in another 11 markets are overvalued by 50% or more.
The research says that the Phoenix metro area ranks sixth nationally in terms of overvalued housing markets at 57.94%.
It says that at the end of April, the average home price in Phoenix was $466,170. This was much higher than the expected home price, which was under $300,000 ($295,164.60).
Home prices have increased rapidly in the Phoenix metro area. The average home price as of April 30, 2021, was $356,078. That means the average home price increased by more than $110,000 in a one-year span; it was a 30.9% increase in home values. Meanwhile, the expected home price only increased by about $10,000 in that stretch.
The economists who conducted the study don’t think this trend will continue.
Most Popular Reply
What is overpriced and overvalued?
Overvalued by 60%? By what metric? What determines overvalued? Are properties listed at 60% more than buyers are willing to pay?
If someone in the free and open market is willing to pay $X how is that overpriced? If a house is priced $X and no one is willing to pay that price, then it's overpriced.
If someone is freely willing to pay $X then, by definition, it's not overpriced.
- Luka Milicevic
- [email protected]
- 270-226-9000
