Quad Cities Real Estate Market Remains Robust

Everyone wants to know when the housing market is going to crash. Prices have risen sharply in the past two years as buyer demand has increased all across Arizona. The pandemic did affect potential home sellers’ willingness to list homes during much of 2020 and into 2021, as well as increase our buyer demand. The good news is that new listings coming on the market have been rising since February. However, we only have 721 active listings on the market in the Prescott area; in September 2019, we had more than 1,200. Of the 721 that are listed as “active,” there are 235 that have contracts on them that include a contingency such as the buyer selling his or her prior home, and that leaves only 489 true active and available homes for sale.

The average sale price in the Prescott MLS area hit an all-time high in August 2021 at $504,555 and dropped to $487,787 in September. Two years ago, in October 2019, it was $359,866. Typically, the housing market is driven by job creation and inbound migration of people to take those jobs and the salaries they will earn. This is not the case with the Prescott area. Our inbound migration is coming from people moving from other states to retire or to become digital nomads who can work from anywhere but move here from a large city. Many of these new residents have higher incomes than the local workforce so there is a real shortage of affordable housing.

Where are all the rentals? AirDNA is a website that provides data on short-term rentals, and they list more than 700 vacation rentals in the Prescott area. Many of these properties used to be traditional rentals and as the available long-term rentals decline, prices on rental housing is shooting up.

The good news for people moving to the area is that there are month-to-month short-term rentals being built with the conversion of the Comfort Suites of Prescott Valley and an additional 24 units that were just added at 1113 and 1117 Gurley Street across from Yavapai Community College.

Builders are working to get new homes constructed and available for buyers, but they are still facing labor shortages and serious issues with the supply chain nationwide.

In commercial real estate, “We are still seeing a lot of demand from owner users versus investors,” said Commercial Real Estate Agent Raymond Zogob with BHGRE Commercial. Interest rates on commercial loans are low and it’s fueling the repositioning of local businesses to space that better matches their needs and also attracting business from other areas. Prescott is still in a growth mode and it doesn’t appear our inbound migration from California and other areas is going to slow any time soon. QCBN

By Leslie Guiley 

Leslie Guiley is chief operating officer at Better Homes and Gardens Real Estate | BloomTree Realty, which includes BHGRE Commercial and she is an area ambassador with Inman News.