A concerning report has raised alarm bells about the housing market in Arizona.
According to a report by the Common Sense Institute, a conservative-leaning think tank, Arizona is experiencing a decline in its competitiveness. The report also highlights a significant housing deficit of over 129,000 units in the state. Furthermore, it reveals that the cost of homes in the Phoenix metropolitan area has surged by 60% since 2020.
Glenn Farley, the director of policy and research at the Common Sense Institute, expressed concern about Arizona’s housing market in a news release. He emphasized the importance of addressing supply issues and implementing necessary policy changes to prevent a decline in housing affordability and the potential loss of a skilled workforce.
According to the Housing Competitiveness Index conducted by the institute on a national scale, Arizona’s ranking has witnessed a decline over the years. In 2011, the state held the 84th position, but it has now dropped to 61. This index evaluates various factors such as the time required to pay off a mortgage, the time needed to pay rent, the existence of a housing shortage or surplus, and the percentage of permits indicating a housing deficit or surplus.
To enhance housing conditions in Arizona, the think tank recommends implementing measures that involve reducing certain housing regulations. This includes streamlining zoning and permit processes, which could potentially contribute to positive changes in the housing sector.
They also mentioned that addressing the issue could involve increasing the availability of homes priced below $300,000 and promoting greater collaboration between the public and private sectors.
According to the report, there is an oversupply of homes in the price range of $300,000 to $1,000,000. However, it also highlights that there is a greater demand for homes under $300,000 than the current supply. This indicates the need for more affordable housing options to be built.
The topic of housing has been a highly debated issue during this legislative session at the state capitol. Governor Katie Hobbs has made several decisions pertaining to housing-related bills, both signing some into law and vetoing others.
She gained attention for her veto of the “Arizona Starter Homes Act,” a bill that had received bipartisan support in the legislature. However, critics raised concerns that the bill would grant the state excessive control over municipalities and local bodies. Supporters of the legislation argued that it aimed to reduce regulations and boost housing supply to make homes more affordable.
Earlier this month, the Arizona Capitol Times reported that Hobbs has signed a bill allowing for the conversion of commercial buildings into residential ones under certain circumstances.
