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Why are home prices high and rising in the Tucson market?

Posted at 11:02 PM, May 26, 2021
and last updated 2021-05-27 02:02:19-04

TUCSON, Ariz. (KGUN) — "Right now we have a good supply and we have a very strong demand," said Laura Mance, with Long Realty.

That old rule of capitalist economics: high demand will drive up the cost of supply.

"It is obnoxious," the words of a recent shopper, Jennifer Dixon, describing the current housing market.

Dixon and her family were able to find a home quickly after she said their rent went up.

The experience left her with an impression she imparts to anyone shopping for a home now.

"Sometimes it comes across as sellers being greedy."

So why are home prices high and climbing?

Mance told KGUN9 the supply hasn't changed in the last few years, something else has.

"We have as many listings coming on the market as we did in 2019 or 2020 but we have more buyers this time."

Mance explained what's driving more people to buy a home right now.

"People that are able to work remotely and they're moving from other parts of the country," she said.

"There are also people moving from within our own community and decided they need more house."

Dixon and her family are among those local buyers.

She said they were on the market briefly but calls the experience unforgiving.

"Eat or be eaten kind of a deal where it was so competitive out there. We were very nervous."

Mance said sellers do have more options now than before because of that higher demand driving local home prices up, and they're expected to keep rising.

"It started at about 5.5 percent, now forecasters are expecting 7.7 percent."

It doesn't mean a buyer can't get a deal, Mance said having your down payment ready to go is a start among other steps ahead of shopping.

"They need to be ready to go, they need to be willing to act fast, they need to have a home inspector lined up."

"We were so fortunate," Dixon said.

Her family was ready to go and they landed a deal within a week.

"It was such a easy, smooth process for us."

Her advice for other buyers be ready.

"Don't let the market scare you and settle for something that you'll have buyer's remorse."

Today's housing market might look familiar to those who remember the housing bubble bursting back in 2008, but Mance said that's unlikely to happen in this case.

"People have more equity in their homes than they had before," she said.

"We don't have loan programs where you're getting a hundred percent financing and you're buying multiple properties."

Mance said, today there are about 625 homes on the market in the Tucson area.

To give you an idea of how fast they're going, she said about 35 homes are being sold or put back into the market every day.