How Gentrification is Affecting Housing Prices in Phoenix
In many US cities, gentrification has been a dominant force for stimulation. It can revitalize the economy and enhance once rundown neighborhoods. It has, however, also caused home prices to increase to the point where they become unaffordable. Like many other cities throughout the country, Phoenix has not been immune from the often-exorbitant price increases that result from the effects of gentrification.
Gentrification is one of the leading causes of controversy in many spheres. But in terms of Real Estate, the controversy lies in the fact that households and homeowners who once were able to afford to live in that neighborhood, start to get squeezed out, whether from high rent or costs of homeownership. Home values begin to rise, and with that, homeowners in the surrounding area pressured to meet demands for and updated interiors and enhanced curb appeal. As more homes become rehabilitated, more long-standing members of the neighborhood find that they have no other option than to move.
Gentrification also results from industrial or commercial Rehabilitation, usually following closely after residential renewal. If you start to see a Whole Foods or Starbucks in the neighborhood, you can be pretty sure the area is in the midst of a period of gentrification. Gourmet coffee is almost always a bellwether of changes to come.
Since 2000, according to a recent census report, 14.2% of the city of Phoenix has gone through phases of gentrification.
As an example, the Hoy Homes Annex neighborhood, near Arizona Avenue and Chandler Boulevard, is an area that has been increasingly seeing the effects of gentrification. Located near downtown Chandler, many of these homes were built in the 1950s. Recently, homes in the area have been listed for prices that show they are what are becoming known as “gentrification properties.” There is a significant difference in price per square foot of a renovated property and one that has not been updated. In this area, newly renovated homes can be listed for $117 or more per square foot. Compare this with non-renovated homes, which have recently sold for $66 per square foot. Much of the demand, is, obviously for the renovated properties
In downtown Phoenix, the Willow District is experiencing the same type of extensive gentrification. There are many similar areas bordering downtown, such as the Garfield, Roosevelt, Coronado, and Encanto neighborhoods. In these regions, it’s not difficult to find gutted and rehabilitated homes that are being listed for upwards of $550,000.
If you’re looking to move into one of these areas, and get in on a nascent market opportunity, but you can’t afford the high prices, contact the real estate experts at We Buy Ugly Houses. With our vast experience in up and coming markets, we’ll help you to purchase a property for far less than the going rate. And, you’ll be able to do so with no commission or fees. Contact We Buy Ugly Houses today to learn how you can get in on the ground floor of some of Phoenix’s most up-and-coming neighborhoods.
*Updated June 2020. Originally posted May 2017.