How Arizona home buying power today compares to the 1970s
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Home buying power in Phoenix decreased nearly 60% from 1970 to 2022, per an Axios analysis of a new RealtyHop study.
- Home buying power is the ratio of annual income versus the average house price in 1970 (when boomers started buying starter homes) compared with 2022.
Why it matters: Buying a house is far less accessible today than it was for previous generations.
The big picture: For almost all of Phoenix's history, our housing prices were below the national average. That changed about five years ago.
- A combination of slow home building and fast population growth caught the Valley in a supply-and-demand conundrum that drove up prices.
- Meanwhile, our wages failed to keep pace with the new housing costs.
Zoom out: Buying power decreased even more in pricey Scottsdale, while Tucson, Chandler, Mesa and Glendale fared slightly better.
Reality check: Mortgage rates were in the double digits in the 1970s and 80s. Today they're hovering around 7%.
What we're watching: Gov. Katie Hobbs last week signed two bills that aim to alleviate Arizona's supply problem by requiring cities of at least 75,000 people to permit backyard casitas and "middle housing" — such as duplexes, triplexes and townhomes — on lots zoned for single-family homes.