It is difficult to pick up a newspaper and not see an article on sky rocketing Scottsdale home prices.
Additionally, Scottsdale has the highest average apartment rental rates in the metro area. Helping to fuel this price surge are out of state buyers moving here who are literally joining in bidding wars to buy a home newly on market.
Unable to succeed they then rent, which in part accounts for an average 96% Scottsdale occupancy rate as well as an average per square foot rental rate that is unmatched in the metro area.
Adding fuel to this inferno are soaring lumber prices that have tripled over the past 12 months and have caused the price of an average new single-family home to increase by $35,872, according to new analysis by the National Association of Home Builders.
This lumber price hike has also added nearly $13,000 to the market value of an average new multifamily home, which translates into households paying $119 a month more to rent a new apartment.
Further adding to affordability woes, building material prices have by and large been steadily rising since 2020 and were up across the board in March.
Coupled with an unprecedented labor shortage; scarcity of land; zoning restrictions and lack of city support, achieving the American Dream in is becoming a nightmare.
For the first time ever, home builders are actually including “kick out” clauses in their sales contracts allowing them to cancel contracts with buyer if prices continue to escalate, in fact, several national home builders have offered to refund buyers’ deposits, with interest, if they will cancel.
Arizona’s economic growth for the last 25 years has been tied to the availability of affordable housing. If you take away that incentive the impact on our state’s economic growth is in peril.
Editor’s Note: Larry Kush is a 45 year resident of Scottsdale, a former planning commissioner and a nationally recognized housing expert.