Phoenix home prices are shooting through the roof!

There are more renters in Phoenix and its surrounding cities than ever before. We saw some of the highest rates of foreclosures than any city in the U.S. when the housing market began its downward spiral in 2007. This has left oodles of Arizonians with no other choice than to rent. Having said that, renting certainly has its perks when compared to owning a home, which has also built a large pool of people choosing to not buy a place. The majority of these people cite a fear of losing money by purchasing a home as prices continue to fall.  I’m here to tell you that time is over in Phoenix; prices are steadily on their way up.

The December 26^th, 2012 S&P/Case Shiller reported that Phoenix home prices have increased 21.7% since 2011. This is a huge jump! It also puts Phoenix way ahead of the improvement of home values than any other city, by a lot. Detroit came in as the second most improved city by percentage change at a distant 10%.

As of December 2012, the median sale price for a home in Maricopa County was $155,000. Not to get too specific, but a typical monthly mortgage payment for a home at this sales price is around $900, which would include interest, taxes, and insurance. According to the Arizona Regional Multiple Listing Service (ARMLS) the average new lease signed in Phoenix as of December 2012 showed that the average renter is paying $1,237 a month. According to my math, it’s looking more financially sound to pay a mortgage rather than rent every month.

Of course homeownership isn’t for everybody. Renting certainly provides a lot more freedom than buying, but it is also leaves your budget open to the uncertainty of inconsistent monthly housing costs. If you’re on the fence it may be time to at least check out some houses on the market and weigh this big decision.