Despite a recent drop in interest rates and minor price declines in some areas, home prices in the Valley remain out-of-reach for many — especially young people.

The current housing market has taken its toll on Maricopa County residents — from renters to homeowners — as housing sales of $500,000 and above climbed from 4% to 43% in just over a decade, according to the Housing Data Explorer from the Maricopa Association of Governments. Similarly, monthly rental prices between $500 and $1,000 have sharply declined from representing about 70% of the market to 7% in the past 14 years.

According to the Housing Crisis Report from the Common Sense Institute of Arizona, “Maricopa County has become a relatively expensive place to live. Higher-than-average consumer price inflation, rent increases, and some of the fastest home price increases in the country mean it may no longer be true that it is relatively cheaper to live in Arizona (and especially the greater Phoenix area) than the average American city.”

The graph above displays sales in the housing market in Maricopa County from 2011 to 2024. According to the Housing Data Explorer from the Maricopa Association of Governments, the graph shows a clear increase in homes sold for under $500,000 in the last 10 years.

Maricopa Association of Governments

Glenn Farley, economist and director of policy and research at the Common Sense Institute of Arizona, said he believes the COVID-19 Pandemic from 2020 to 2022 has lingering effects on the housing market — and may be one of the driving causes of the current housing crisis.

“...(T)here was a real demand shock during that period where people were spending a lot more time at home…and so what they wanted from that home became much more important to them during that period,” he said. “People were looking for bigger places to live, they were looking to live in other cities. Folks were spending a lot more time at home working remotely for example. So there was a real demand shock in places like Phoenix for housing during that period that contributed to an increase in prices.”

With the COVID-19 pandemic winding down almost two years ago, many young and eager home buyers expected housing prices to lower shortly. However, that may not be the case.

“If you would have asked me that a couple of years ago I would have said that prices are likely to come down. In the near future, it’s just not sustainable to see these kinds of decreases,” said Farley.

David Chase, a recently married renter in Queen Creek, searched for a place to rent when he and his wife, Kara, were married in July.

“When we were looking for a place to rent, it was challenging,” he said. “Most apartment complexes charge over $1,500 a month without utilities, for an apartment that doesn’t include a washer or dryer or even an oven, and there are usually hidden fees on top of rental prices. We ended up renting out a casita.”

Kara Chase said she remains fairly pessimistic about future homebuying.

“I would recommend that anyone in the rental market find a casita or a privately-owned home to rent,” she said. “Rental prices in apartment complexes are just not reasonable anymore.”

Farley of the Common Sense Institute said it is unlikely that prices will come down anytime soon.

“The solution to this is more supply, but it is difficult, expensive and time-consuming to bring that supply to market,” Farley suggests. “The fastest, easiest cheapest way policy-makers can fix this problem is to fix those barriers to bring in the supply; make it relatively easier to bring those units to market as quickly as possible to bring these prices down.”

Leah Haynes is a student at the Walter Cronkite School of Journalism and Mass Communication at Arizona State University.