Building Costs Per Square Foot in the City of Phoenix (AZ), USA

Newly Built House in Phoenix 2927 W Latona Road AZ-85339 – 4 Bed and 3 Baths with 3 x Attached Garages on Gross Floor Area 2,766 sqft – Built in 2022 – Price $699,000 (2)

Residential Construction Market Analysis in the City of Phoenix, USA

Building costs are 3% above the national average in the City of Phoenix in Arizona, equivalent to the city of Mesa, Lompoc, Sacramento, Norwich, Granite City, Rockford, Marquette, Meridian, Knob Noster, Las Vegas, New Boston, Raleigh, Bismarck, Cincinnati, Cleveland, Newark (ND), Allentown, Harrisburg, Greenville, Vancouver, Green Bay and Gillette. Among the cities on the West Coast of the United States, Phoenix is probably the least visited by tourists, but this does not mean that it is not a good place to live, on the contrary! It is a quiet city, which has all the comforts of a big city but the spirit of a small town.

It is a city that is growing, especially in the real estate sector. With the pandemic, more people decided to choose to live in states surrounded by nature, especially with the advantages of having a home office there. For that very reason, the Phoenix real estate market has gone through some never-before-seen moves.

To learn more about this, continue reading this article, where we will focus on the city of Phoenix, located in the state of Arizona, and its real estate market. From the values of the properties to the projects that are coming in the next few years and the expected values, here we will take care of everything.

Phoenix Construction Outlook

Phoenix is like an oasis within the Arizona desert. Although this state has other towns, its main city is Phoenix, and it has seen such great growth in recent years that it is considered one of the rising cities in this country.

Many people when they think of Phoenix only think of a desert and rocks with red soil, but in reality, Phoenix is a city like any other. It has buildings, although these rarely exceed 15 floors. They are not the typical skyscrapers of big cities.

There are also some residential houses that are the big stars of this city. They are perfect houses for middle-class families with 4 to 6 members. They can live more than comfortably in the large residential houses of the city.

Luxury homes are not common in Phoenix, but you may find some. The good thing is that the ones you find will be much cheaper in this city than in any other part of the country practically.

Phoenix Housing Market Analysis and Forecast

The Phoenix real estate market is marked by a lot of demand, but not as much supply, so sellers are the big winners. This low demand makes many people compete for the same property, so there will always be some people willing to bet a higher price, causing the general prices to increase.

In Phoenix, it is very common that the houses for sale are always open to receive possible buyers, and there are some days dedicated to receiving them all at the same time. In those cases where the competition is this direct, the values ​​can be up to $50,000 more than the expected sale price.

Within the Phoenix metropolitan area real estate market, new listings increased by 26.3% from July 2020 to July 2021. While in the case of the period from June 2021 to the same time in 2022 the increase is only 10%, which means that the real estate market does not have as much offer yet.

Housing market projections for the remainder of 2022 and 2023 are that inventory will become more stable as baby boomers put a large number of homes on the market this spring. This means that there are more options of houses available, making the relationship between supply and demand more even.

Phoenix Average House Price (Median Home Price)

The value of the median home in Phoenix is ​​$433,660, which may seem normal when you compare it to other cities, but keep in mind that it had an increase of more than 20% compared to the same period but during the past year. During 2021 in the month of June the median home value in Phoenix was a little bit over $340,000.

Do not despair, it is not believed that the increase to June 2023 will also be 20%, it is expected to be just 10% or 6% if the amount of property offered is increased.

Remember that the median home value is an average among all the properties in the city, so you can find some properties cheaper, or even more expensive, depending on the part of the city you are in or the type of house it is.

A single-family home goes up to $500,000 in downtown Phoenix or in more expensive areas. An apartment or condominium house costs up to $350,000 and usually has enough rooms to accommodate a family of 4 or 6 people.

There are parts outside of Phoenix where you can find properties for less than $300,000. You have better chances of finding good prices if you are willing to buy old properties and then investing in the remodelling of the house. For example, a house from the 50s or 60s may cost $150,000, and for remodeling, you may have to put up a maximum of $100,000. While it is more work, it is a great option if you are on a budget.

Proposed Residential Building Projects in Phoenix

The residential construction projects in Phoenix for 2022 and 2023 are quite modest. Yes, there are some buildings planned for these years, but they are not typical skyscrapers either. The tallest are 20-story buildings.

The buildings usually have apartments prepared to accommodate, in some cases, families of 4 people, in other cases couples, and there are even some studio apartments. Studio apartments are not the most common since Phoenix is a city designed for comfort, so living in just one room is not something that is usually chosen by the person who is going to live in this city, so it is not something that investors choose to build.

There are some suburban projects with modern houses, but they are not necessarily luxury houses. They are not the typical mansions with more than 8 rooms with a pool, but rather more modest houses. If they are houses that have a garden, since that is essential for life in Phoenix, especially in summer.

Newly Built House in Phoenix 2531 E Broadway Road AZ-85040 – 4 Bed and 4 Baths with 2 x Attached Garages on Gross Floor Area 2,215 sqft – Built in 2022 – Price $469,000 (1)

Building Costs Per Square Foot for Single Family Homes in the City of Phoenix (AZ), USA

Building costs are 3% above the national average in the City of Phoenix in Arizona, equivalent to the city of Mesa, Lompoc, Sacramento, Norwich, Granite City, Rockford, Marquette, Meridian, Knob Noster, Las Vegas, New Boston, Raleigh, Bismarck, Cincinnati, Cleveland, Newark (ND), Allentown, Harrisburg, Greenville, Vancouver, Green Bay and Gillette.

Class 1 – Luxury Single Family Homes

The building cost per square foot for luxury private homes in Phoenix City ranges from $355.24 per sqft to $544.56 per sqft, with the average being $419.23 per sqft. As the bar chart shows below, bigger homes with a large gross floor area have the lowest building costs per ft2, and smaller homes with a small gross floor area have the highest building costs per ft2. Medium-sized homes are somewhere in between. Generally, the building cost per square foot decreases as the size of the house gets bigger, and increases as the house gets smaller.

Class 2 – Semi Luxury Single Family Homes

The building cost per square foot for semi-luxury private homes in Phoenix City ranges from $215.90 per sqft to $330.94 per sqft, with the average being $254.78 per sqft. As the bar chart shows below, bigger homes with a large gross floor area have the lowest building costs per ft2, and smaller homes with a small gross floor area have the highest building costs per ft2. Medium-sized homes are somewhere in between. Generally, the building cost per square foot decreases as the size of the house gets bigger, and increases as the house gets smaller.

Class 3 – Best Standard Single Family Homes

The building cost per square foot for best-standard private homes in Phoenix City ranges from $139.57 per sqft to $211.98 per sqft, with the average being $163.40 per sqft. As the bar chart shows below, bigger homes with a large gross floor area have the lowest building costs per ft2, and smaller homes with a small gross floor area have the highest building costs per ft2. Medium-sized homes are somewhere in between. Generally, the building cost per square foot decreases as the size of the house gets bigger, and increases as the house gets smaller.

Class 4 – Good Standard Single Family Homes

The building cost per square foot for good-standard private homes in Phoenix City ranges from $101.86 per sqft to $156.20 per sqft, with the average being $120.21 per sqft. As the bar graph shows below, bigger homes with a large gross floor area have the lowest building costs per ft2, and smaller homes with a small gross floor area have the highest building costs per ft2. Medium-sized homes are somewhere in between. Generally, the building cost per square foot decreases as the size of the house gets bigger, and increases as the house gets smaller.

Class 5 – Average Standard Single Family Homes

The building cost per square foot for average-standard private homes in Phoenix City ranges from $82.68 per sqft to $126.62 per sqft, with the average being $97.49 per sqft. As the bar graph shows below, bigger homes with a large gross floor area have the lowest building costs per ft2, and smaller homes with a small gross floor area have the highest building costs per ft2. Medium-sized homes are somewhere in between. Generally, the building cost per square foot decreases as the size of the house gets bigger, and increases as the house gets smaller.

Class 6 – Minimum Standard Single Family Homes

The building cost per square foot for minimum-standard private homes in Phoenix City ranges from $65.21 per sqft to $99.95 per sqft, with the average being $76.92 per sqft. As the bar graph shows below, bigger homes with a large gross floor area have the lowest building costs per ft2, and smaller homes with a small gross floor area have the highest building costs per ft2. Medium-sized homes are somewhere in between. Generally, the building cost per square foot decreases as the size of the house gets bigger, and increases as the house gets smaller.