So many out-of-town people are moving to and searching for apartments in Phoenix that they are putting pressure on rent prices for local Phoenix renters, according to a report from Apartment List.
“This migration flow is putting pressure on local rent prices because these movers have budgets that are 10 percent higher than the existing residents who are also searching for a new apartment,” Apartment List housing economists and experts Chris Salviati, Rob Warnock, and Igor Popov write in the report.
On average, Phoenix residents looking for a new home have a monthly budget of $1,213, while renters searching from a different metro have a budget of $1,332.
“Our newest Quarterly Migration Report finds that not only are more people moving, but movers today have higher incomes and higher budgets than ever before. This is putting added pressure on already-competitive markets and contributing to rising rent prices across the country,” the report says.
People moving from higher-rent locations driving up prices
Rents in Phoenix have increased by $200 overall in the last year.
In Yardi Matrix’s latest multifamily report, the company says “many people moving into Phoenix are coming from higher-cost locations, where they are accustomed to higher rents. But for longtime residents of Phoenix, the swift price increases are driving them to downsize or find a lower-cost location to live.”
This migration to Phoenix is coming largely from higher-cost California, the report says.
The single-family housing market is performing equally as strong as the rental housing market, with prices up almost 22 percent on a year-over-year basis, according to the S&P Case Shiller Index.
Limited new supply in Phoenix is one factor contributing to the spike in rental and home prices. As of June, 3.2 percent of stock had been delivered in the last 12 months. “Even though this falls in the top 10 of our 30 largest metros, it is not enough to keep up with the demand,” Yardi Matrix said in its report.
