09/07/2026
GREAT ARTICLE ON THE PHOENIX HOUSING MARKET
Has Phoenix’s summer housing slowdown lost its chill?
ASU real estate expert Mark Stapp explains why triple-digit heat still affects the market, but jobs, migration and tight inventory now play a bigger role
Close-up view of a "for sale" sign outside of a home.
Photo by iStock
By Marshall Terrill |
September 03, 2026
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According to Mark Stapp in ASU's W. P. Carey School of Business, seasonal forces no longer have the same power to shift the balance between buyers and sellers in the Valley of the Sun.
In today's market, a summer lull does not necessarily give homebuyers more leverage; demand remains steady, inventory remains tight and affordability pressures continue, especially for first-time buyers and middle-income families searching below the median price.
"The calendar still affects the number of transactions. But it no longer determines who has the upper hand," Stapp says.
For years, Phoenix homebuyers could count on a familiar rhythm: The market heated up in spring, slowed in summer and stirred again in fall.
But that familiar seasonal pattern is changing.
The Valley of the Sun’s housing market still responds to school calendars, vacations, holiday weekends and triple-digit temperatures. But according to Mark Stapp, Fred E. Taylor Professor of Real Estate at Arizona State University’s W. P. Carey School of Business, those seasonal forces no longer have the same power to shift the balance between buyers and sellers.
In today’s market, a summer lull does not necessarily give buyers more leverage. Demand remains steady, inventory remains tight and affordability pressures continue, especially for first-time buyers and middle-income families searching below the median price.
Portrait of Mark Stapp
Mark Stapp
Stapp says the change reflects more than a one-year anomaly. Population growth, job creation, migration, high construction costs and a persistent housing shortage have made Phoenix less dependent on the old calendar cycle. The market may still slow slightly in July and August, but the structural pressures behind it do not take the summer off.
ASU News spoke with Stapp, who directs the Master of Real Estate Development program and the Experiential Learning Lab at the W. P. Carey Center for Real Estate and Finance, about why Phoenix’s housing market is becoming less seasonal and what that means for buyers and sellers.
Note: The following interview has been edited for length and clarity.
Question: For years, Phoenix’s housing market followed a predictable seasonal cycle. Are those days over?
Answer: I’d push back gently on “over.” The data doesn’t show that seasonality has disappeared. It shows something more interesting. The spring selling season is still real. Sales and new listings continue to peak in spring and fall off into summer, a pattern we can see in 2024, 2025 and 2026. But that pattern is not as pronounced as it was in the early to mid-2010s.
What has changed is what the summer slowdown means. In most years since 2016, with 2022 as the clear exception, the seasonal dip has not shown up as a year-over-year collapse in demand the way a true buyer’s-market slowdown would. Volume drops, but leverage doesn’t shift. Because supply remains so limited, prices and sales activity don’t fall as much as they otherwise might, even when the number of transactions declines.
So the calendar still affects the number of transactions. But it no longer determines who has the upper hand.
Q: Why isn’t the summer heat slowing home sales the way it once did?
A: Largely because the market is now shaped by a persistent supply deficit. Demand stays elevated throughout the year while supply remains tight, so the old buyer strategy — wait until fall, when everyone else stops looking — is less effective than it used to be. Competition for homes priced under $450,000 doesn’t meaningfully let up in July or August, no matter what the thermometer says.
Q: You describe this as a structural shift rather than a temporary trend. What do you mean by that?
A: A temporary trend reverses once the condition that caused it goes away, such as pandemic-era migration spikes or a rate-driven pause in activity. A structural shift means the link between the calendar and market behavior has changed in a more fundamental way.
Historically, summer slowdowns happened because demand itself was more seasonal. People took vacations, holidays clustered and many buyers didn’t want to house hunt in 110-degree heat. Even if families moved during summer before school started, they often bought in late spring. Today, the binding constraint isn’t waning desire. It’s a persistent supply deficit that doesn’t relax just because it’s July.
Estimates of the shortage vary, but about 56,000 units is a reasonable figure for the region. A gap that size doesn’t close for three months and reopen in the fall. New construction is running at roughly the pace of new household formation, which means it absorbs incoming demand without meaningfully reducing the backlog. Existing home inventory remains very tight, especially below median price. The market operates in deficit year-round. That’s what makes this structural rather than cyclical.
Employment, not the calendar, is increasingly setting the pace. Migration continues to track economic expansion, and the region’s job base has been reshaped by Phoenix’s emergence as a semiconductor hub alongside health care and advanced manufacturing. Jobs tied to TSMC, Mayo Clinic and their supply chains don’t pause for July.
Even in more optimistic economic scenarios, there’s little evidence of a steep decline ahead because demand is strong and supply isn’t outpacing it. This is nothing like 2008.
Q: Why has inventory remained so tight, especially for homes below the median price?
A: This is fundamentally a construction economics problem, not a market-timing problem. Existing home inventory is still affected by the “lock-in” effect of very low interest rates, while new construction is limited by what is financially feasible and what is needed to meet actual growth.
New construction is difficult for several reasons. Developable land is scarce, construction and labor costs are high, and infrastructure costs are very high. Land and building costs have risen faster than entry-level buyers can absorb, and federal trade policy has added pressure to material costs. It is exceedingly difficult for a builder to profitably deliver a new home priced under $450,000 in this market. When builders do, those homes are often farther from employment centers, adding transportation costs for buyers. As a result, new supply skews toward the middle and upper price tiers, while the entry-level segment relies on turnover in the existing housing stock, where inventory is thinnest.
Permitting has slowed statewide as well, even as Arizona’s population keeps growing. When costs rise and approvals slow at the same time, the price point squeezed first is almost always the lowest one.
Q: What does this mean for first-time homebuyers and middle-income families?
A: The practical effect is that affordability pressure doesn’t ease during the “buyer’s season” the way it once did. First-time and middle-income buyers are competing for a shrinking pool of existing homes priced under $450,000, with mortgage rates in the 6.3% to 6.6% range compounding the pressure on monthly payments. Those rates are near levels not seen since the 2008 time period.
There is some relief in current 2026 conditions, but it’s modest and uneven.
The practical guidance runs in two directions. One is geographic: Outer submarkets such as the far West Valley and Pinal County still offer homes below $450,000, often with builder incentives attached. The other is about timing. Buyers should stop assuming the fall will automatically be better and start treating the offseason as a genuine opportunity. There may be fewer competing buyers in absolute terms, especially while higher rates keep some buyers out of the market.
Q: Looking ahead, what would need to happen for the Valley to return to a more balanced housing market?
A: A genuinely balanced market would require several things to happen at the same time:
First, the region would need a sustained increase in entry-level supply, which would require falling construction costs, including materials, labor and land, or significant policy intervention. None of these changes is likely in the foreseeable future, given migration policy, tariffs and bond rates.
Second, permitting and entitlement approvals would need to accelerate to reverse the current statewide slowdown in building permits. Builders pull permits for what they can sell, and local jurisdictions control many of the regulations affecting costs and timing. Water and power supply will also constrain new development.
Third, housing production would need to stay ahead of population growth.
Fourth, interest rate relief would need to unlock existing homeowners who are currently locked into low rates and unwilling to sell, making more existing home inventory available. That lock-in effect is a significant and often underappreciated contributor to tight inventory.
Without several of those changes happening at once, the likelier near-term path is incremental normalization: moderating price appreciation and slightly longer selling times, which we're already seeing in 2026, rather than a full return to the old seasonal cool-down and heat-up cycle. Slow normalization is how a market stays healthy.
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