Chandler Housing Market Trends in 2024
Home Sales in Chandler, Arizona
The Chandler housing market shows steady activity. According to Redfin data from September 2024, 185 homes were sold, representing a 6.9% increase compared to the same period last year. This signifies continued demand despite potential economic shifts. The increase in sales suggests a relatively healthy market, with buyers actively searching for homes. This is good news for sellers as increased demand generally translates to better sale prices. However, it's also worth considering the average time it takes to sell a house in Chandler.
While the number of sales has increased, the average days on market (DOM) has also risen to 47 days, a 13-day increase year-over-year. While this still indicates a relatively fast-paced market, the increase is notable. This suggests there might be a slight shift toward a more balanced market compared to previous years when homes sold significantly faster. It could signal a slightly slower pace in the buying frenzy of previous periods, offering opportunities for both buyers and sellers to negotiate terms more thoroughly.
Home Prices: A Look at the Median Sale Price in Chandler
The median sale price of a home in Chandler in September 2024 was $525,000, a 1.9% increase year-over-year. This reflects a modest price appreciation, showing that although prices are increasing, the rate of increase is slightly moderating compared to the substantial jumps witnessed in previous market cycles. However, the median sale price per square foot is $299, showing a slightly higher year-over-year increase of 3.6%. This highlights that while the overall median price change is relatively conservative, the cost per square foot continues to climb indicating an influence of factors like build costs and land availability.
Several factors might be contributing to this trend. Inflation, building material costs, and increased demand can all influence the price. The increasing costs of development in the area likely play a significant role in these price increases. Additionally, Chandler’s desirability as a place to live, due to its job market, schools, and quality of life, is also a factor that can affect housing prices.
Housing Supply and Its Impact on the Chandler Market
Understanding the housing supply is crucial for grasping the overall market dynamic. Unfortunately, Redfin data on the exact number of homes available for sale in Chandler is not explicitly stated. However, the increased Days on Market (DOM) compared to last year could indirectly indicate changes in supply. A rise in DOM suggests that available homes might be taking longer to sell, which could be due to a relatively higher supply of homes compared to the demand. However, this requires further data on inventory levels to be definitively confirmed.
A balanced market usually indicates a comfortable ratio between supply and demand. In a seller’s market, inventory is low, and homes sell quickly. In a buyer’s market, inventory is high, and houses may stay on the market for a longer period. The current increase in DOM suggests a move toward a more balanced market compared to a strong seller’s market seen in previous periods.
Market Trends: A Holistic View of the Chandler Housing Market
Several indicators provide a broader perspective on Chandler's housing market. The Sale-to-List Price ratio is 98.4%, representing a small decrease from last year's figures. This suggests that homes are generally selling close to their listing prices, implying a competitive yet somewhat stable market. Only 17.3% of homes sold above the list price in September 2024; this represents a significant drop of 13.3% year-over-year. The decrease in homes selling above list price compared to the previous year supports the notion of a moderately slowing market.
The data shows 34.8% of homes experienced price drops, indicating some level of price adjustment. While this might seem like a negative, it can actually be a healthy sign, preventing drastic price inflation and potentially creating more opportunities for buyers to find a better deal.
Migration Patterns: Where are People Moving to and from Chandler?
Redfin's data on migration patterns provides valuable insights into Chandler's housing market. A notable trend is the inbound migration from major metropolitan areas such as Seattle, Los Angeles, and Dallas. This influx of people from other cities increases demand, which in turn can elevate prices and contribute to competitiveness. While 70% of Chandler buyers are staying within the metropolitan area, it's the inflow from other significant areas that pushes the market dynamics.
On the outbound side, migration patterns illustrate that many people move to smaller Arizona towns like Prescott Valley, Show Low, and Flagstaff. This might reflect a preference for smaller towns and more affordable housing options or a change in lifestyle and job opportunities. These movements can lead to varying degrees of impact in the Chandler housing market.
Other Factors Affecting the Chandler Housing Market
Several factors, beyond those discussed above, affect the Chandler housing market. The quality of schools is often a major consideration for families. Chandler has several highly-rated schools, attracting homebuyers seeking top-tier education for their children. The employment market also plays a vital role. A thriving job market will naturally boost the population and real estate demand. Finally, the overall lifestyle in Chandler, with its amenities and suburban feel, attracts people from various backgrounds.
Chandler Housing Market Forecast 2024-2025
Predicting the future of any market is inherently challenging, but analyzing the factors mentioned above allows for informed speculation. My personal opinion, based on years of observing the Chandler housing market, is that we'll see continued growth, although likely at a more moderate pace than what was experienced during the peak of the pandemic boom.
- Price Appreciation: I anticipate a continued, albeit potentially slower, increase in home values in Chandler. While the rapid appreciation of the past few years may not be sustainable, steady growth seems probable, driven by continued population growth and economic strength. However, this growth rate might be influenced by factors such as interest rate changes and national economic conditions. Don't expect double-digit percentage increases, but rather a more moderate and steady appreciation.
- Sales Volume: I foresee a slight moderation in the number of homes sold compared to the high volumes seen in the past couple of years. The increased interest rates and affordability challenges will likely dampen some demand, although a healthy level of transactions should persist.
- Inventory Levels: While new construction is underway, overcoming the existing inventory shortage will likely be a gradual process. We might see a slight increase in available homes, but I don't anticipate a dramatic shift that would cause significant price drops.
Table Summarizing Forecast:
| Factor | Forecast | Rationale |
|---|---|---|
| Price Appreciation | Moderate increase | Continued population growth, economic strength, but tempered by interest rates and potential economic slowdown |
| Sales Volume | Slight decrease from peak years, but still healthy | Interest rates and affordability impacting demand, but underlying economic fundamentals remain positive |
| Inventory Levels | Gradual increase, but still below historical norms | New construction is ongoing, but meeting demand will take time |
Should You Invest in the Chandler Real Estate Market?
The Chandler real estate market has shown steady growth over the past few years, making it an attractive option for real estate investors. Here are some top reasons why investing in Chandler real estate may be a good decision, as well as potential drawbacks to consider:
Top reasons to invest in Chandler real estate:
- Strong appreciation: Chandler real estate appreciated 139.53% over the last ten years, which is an average annual home appreciation rate of 9.13%, putting Chandler in the top 10% nationally for real estate appreciation (Neighborhoodscout).
- Steady market: The market forecast for Chandler is positive in 2023, indicating a stable market with little fluctuation.
- High demand: Chandler is a growing city with a population of over 260,000 people. Its strong job market and high-quality schools attract many young professionals and families, creating a high demand for housing.
- The rental market in Chandler: Chandler also has a strong rental market, making it an attractive option for investors who are interested in purchasing properties to rent out. Chandler has a large population of young professionals and families, who may prefer renting over buying, creating a high demand for rental properties. Investors should consider the potential rental income and rental demand when evaluating investment opportunities in Chandler.
- Thriving Economy: A good economy can be a reason to invest in Chandler real estate. Chandler has a thriving economy, with a diverse range of industries such as technology, healthcare, and retail. The city has been experiencing steady economic growth, with a low unemployment rate and a high job growth rate, making it an attractive destination for businesses and professionals. This economic growth has also led to an increase in population, which in turn drives demand for housing. The city has also been investing in infrastructure and public amenities, such as parks and recreational facilities, which can make it more attractive for both residents and businesses. Additionally, Chandler has a well-regarded school system, which can make it more appealing for families with children.
All of these factors can contribute to a strong real estate market in Chandler, with high demand for housing and the potential for appreciation in property values. Real estate investors can benefit from this by purchasing properties in areas with high demand and potential for growth and renting or selling them for a profit.
Potential drawbacks to consider:
- High competition: Due to the high demand for housing in Chandler, investors may face competition when making offers on properties.
- High home prices: While appreciation is a good sign for investors, it also means that home prices may be higher than in other markets, making it more difficult to find affordable investment opportunities.
- High-interest rates: It's worth noting that the high-interest rates could potentially impact the Chandler real estate market, as buyers may be deterred from taking out mortgages due to the increased costs. The current average 30-year fixed mortgage interest rate is 6.54%. Hence, borrowers may be less inclined to purchase homes, especially if they have other options available to them. Investors looking to buy in Chandler should carefully consider the impact of high-interest rates on their investment strategy, as they may need to adjust their expectations for return on investment. Additionally, the potential for inflation and rising costs should be factored into any investment decision.
