Valorie Rice, Senior Business Information Specialist
Current data releases as of 26 February 2021
House prices in Arizona increased 14.1 percent between the fourth quarter 2019 and the fourth quarter 2020. The Federal Housing Finance Agency (FHFA) U.S. House Price Index report for the fourth quarter 2020 indicated that one-year house price appreciation in the U.S. was 10.8 percent. Mountain states topped the country in house price increases for the quarter with Idaho increasing 21.1 percent followed by Montana at 15.5 percent, Utah at 15.4 percent and Arizona as the fourth highest state. All states and the District of Columbia had positive house price appreciation. Metropolitan area data are available with the all-transactions index (which includes both purchase and refinance mortgages). There were two Arizona metros near the top of the rankings – Lake Havasu City-Kingman ranked 6th among all metropolitan areas with a one-year increase of 10.5 percent for the fourth quarter 2020 followed by Phoenix ranking 7th with a 10.3 percent increase. Price appreciation in other Arizona metros: Yuma 9.5 percent, Tucson 8.3 percent, Flagstaff 7.9 percent, Sierra Vista-Douglas 7.5 percent, and Prescott Valley-Prescott 7.3 percent. See our Arizona’s Economy Housing page.
Phoenix ended 2020 with its 19th consecutive spot at the top of the S&P Corelogic Case-Shiller Index posting a 14.4 percent year-over-year increase in house prices for December. Seattle and San Diego had the next highest price increases at 13.6 percent and 13.0 percent, respectively. At a 7.9 percent, Las Vegas had the smallest increase of the 19 cities reporting for December. The national home price index had a 10.4 percent annual gain while the 20-city composite had a 10.1 percent gain.
Housing affordability held steady for the nation in the fourth quarter 2020 with 58.3 percent of homes sold being affordable for families earning the U.S. median income according to the NAHB/Wells Fargo Housing Opportunity Index released February 8. The press release indicated that historically low interest rates offset record high home prices to keep affordability at the same rate as the previous quarter but that it may not be the case going forward based on continued home price escalation. Over half of the metropolitan areas in Arizona had a higher share of affordable homes than the nation with Sierra Vista-Douglas ranking near the top nationally with 88.3 percent. The share of homes affordable for a median family income in other Arizona metros for the last quarter of 2020: Yuma 75.0 percent, Tucson 68.9 percent, Phoenix 60.6 percent, Lake Havasu City-Kingman 58.0 percent, Flagstaff 45.6 percent, and Prescott 43.0 percent.
Of the 357 largest counties in the U.S., 355 of them had a decrease in employment between September 2019 and September 2020 according to the February 24 Quarterly Census of Employment and Wages (QCEW) release from the Bureau of Labor Statistics. The two counties with positive employment growth were both in Utah (Davis, UT and Utah, UT). Maui + Kalawao, HI had the largest over-the-year decrease at -35.4 percent. In Arizona, Maricopa County employment decreased 4.1 percent and Pima County decreased 5.7 percent for that time. While employment was down, average weekly wages increased over-the-year for the third quarter 2020 with wages going up 7.4 percent for the nation. Of the 350 counties with a rise in wages, San Mateo, CA posted the largest gain with an increase of 23.2 percent. Both Maricopa and Pima counties had increases similar to the nation at 7.4 percent and 7.6 percent, respectively.
Arizona bankruptcy filings continue to trend down as the number filed in the state during January 2021 was 713, 141 fewer than December and 36.0 percent lower than January of 2020. All forms of bankruptcy were the equal to or lower than the same period a year ago with Chapter 13 filings (individual debt adjustment) declining by 59.6 percent. Over-the-year decreases in bankruptcies were most prominent for the Yuma office, going down 38.3 percent followed by a decrease of 37.0 percent for the Phoenix office and a decrease of 32.1 percent for the Tucson office. The Tucson office handles Cochise, Graham, Greenlee, Pima, Pinal, and Santa Cruz counties. The Phoenix office includes Apache, Coconino, Gila, Maricopa, Navajo, and Yavapai counties. The Yuma office represents La Paz, Mohave, and Yuma counties.
Phoenix is now a Tier 1 city according to The Milken Institute Best-Performing Cities 2021: Foundations for Growth and Recovery released on February 17. For the first time, the rankings have been broken down into five tiers – the top 13 cities (metros) within the large cities list and the small cities list making up Tier 1. Phoenix now ranks seventh among large cities placing it in Tier 1. Arizona has three Tier 2 cities, two Tier 3 cities and one Tier 4 city. Tucson, the only other metro in Arizona among large cities, was listed as a Tier 2 large city with a rank of 41 among large cites. Within Tier 2 small cities, Lake Havasu City ranked 16 and Prescott Valley ranked 25. Yuma and Sierra Vista were among the Tier 3 small cities with ranks of 66 and 100, respectively. Flagstaff fell to Tier 4 with a rank of 169 out of 201 small cities, a drop of 82 places from its 2020 ranking. There were no Arizona cities within Tier 5. See a recent article to find out more about this year’s rankings.
