Satistical Story
Rent prices in Phoenix have been burdening people in recent years, causing significant strain on residents. According to Axios, Arizona renters spent 30% to 50% of their income on rent last year.
The average rent for all bedroom types in Phoenix, AZ, is $1,534 to $1,828, including student-affiliated housing. Coming from Zillow.com
Launch Real Estate agent Christoph Hirota emphasizes that jobs aren't increasing wages for regular employment; he says,
"Downtown Phoenix's future is promising and grim; rent will only get more expensive. People are moving a little slowly, finding ways to make more money. Granted, people can't always change their situation quickly."
"The rent in downtown Phoenix had gone up quickly before COVID-19, but it's gotten worse now that COVID-19 is over. The average household income rose two times the median Income. It has been a 30% rent hike since 2021." "Each year since then it's gone up 10%."
The analysis of building permits and economic growth data shows that rent price increases correlate with the development of upmarket buildings.
Approximately 80% from 2016 to 2021, According to Phoenix Community Alliance and Arizona PBS
With the construction of these upmarket buildings, the middle-class income population is slowly being pushed out; as rent increases by 0.1% every month, downtown Phoenix is being revitalized for higher-class living. Fox 10 reported
Property developers emphasize luxurious lodgings, which will appeal to higher-class residents and raise housing rates. Thirty-three properties have been in development these past several years.
Mark Stapp, director of the Master of Real Estate Development program at Arizona State University, has been monitoring the progression of downtown construction projects.
" The Valley rents are among the fastest growing in the nation, and wages aren't growing that fast, at least not faster than the apartment buildings being constructed," said Stapp.
Stapp also has been monitoring the transfer from student housing to commercial apartments.
"As real estate properties become available in the downtown area, student housing is pushing students out, and those apartment buildings and complexes are being renovated construction-wise, and so are prices," Stapp said.
This growth is attributed to the expansion of downtown Phoenix, the metropolitan area plans to expand over 260,000 square feet in the next few years, and the jobs and diversification of the downtown area. According to dtphx.org
Another expert on the issue, Jim Rounds, is a consultant who presented the findings of an economic impact study and emphasized downtown's many different values.
"Downtown, because it's diversified there, adding more higher-wage jobs, has become a unique economic epicenter in the greater Phoenix area. "However, many jobs are still not keeping pace with rent prices."
With the focus on building more lavish buildings, there is also a high demand for occupancy, as 60% of renters live in downtown Phoenix. Jim Rounds also says Downtown is looking to mix its pricing model with that of Los Angeles and Las Vegas.
This means Phoenix is looking to increase pricing like Los Angeles and have big attractions in the city like Las Vegas, giving a concrete reason for the price increase.
Downtown is driving up the cost of living. Phoenix is facing challenges with its downtown crisis and rising rent prices, but it is also making significant economic growth and development strides.
The city's efforts to address rising costs and its focus on economic expansion present a picture of a town in transition, grappling with its issues while working towards a brighter future.
Contact Information
Mark Stapp
· Email: mark.stapp@asu.edu
Jim Rounds
· Phone: 602-739-0844
Christoph Hirota
· Phone: 425-458-8158
https://www.axios.com/local/phoenix/2024/02/02/arizona-renters-cost-burden