The Phoenix housing market is experiencing a reset. Inventory is rising, buyers are more cautious, and both new home builders and individual resellers are stepping up with incentives to win over today’s selective buyers.
According to a recent Realtor.com report, the median list price in Phoenix sits at $510,000, but homes are actually selling for a median price of $469,000. That gap signals what many of us already know: buyers are in control, and concessions are becoming the norm, especially as inventory climbs across Arizona.
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New home builders have enjoyed a historic advantage over existing home resellers due to low housing inventory and low rates. From mid-2020 through early 2024, resale inventory was limited, but demand to move into the Valley was high. Often, buyers had to rely on new home builders to satisfy this demand and provide homes for these prospective buyers. Then at the beginning of 2025, housing inventory began to rapidly rise in Arizona, saturating the market. Homeowners who purchased when builders were rapidly meeting buyer demand were (and are still) looking to sell their former homes.
We’re approaching pre-pandemic inventory levels again, which means buyers have more options, sellers are facing longer listing times, and the market is moving toward balance. Builders are responding quickly with headline-grabbing perks. But these offerings come with fine print that buyers – and resellers – shouldn’t overlook.
Homebuilders have long enjoyed the benefit of scale, working with preferred lenders, contractors, and suppliers to offer packages that resale sellers typically can’t match. Some of their most common incentives include:
Closing Cost Assistance
This option is appealing to home buyers who might not be able to afford the initial down payment on a property. For example, a 20% down payment may pose a challenge for purchasing a home. Home builders may offer financial assistance in covering the home’s closing costs, which increases the likelihood of the property selling at a faster rate, versus waiting the average time of over 50 days for a home to sit on the market before selling.
Design Option Upgrades
Most appealing to affluent buyers who have down payment costs covered, new home builders have an advantage over individual home resellers due to maintaining relationships with contractors and appliance suppliers. From quartz countertops to energy-efficient smart thermostats, builders can bundle high-demand finishes, though typically only on inventory homes with pre-selected packages.
(Temporary) Interest Rate Buydowns
A recent popular, but often misleading perk for buyers is the offer for a very low interest rate buydown. As rates currently hover close to 7%, homebuilders can advertise rates as low as 3.99% for the first couple of years to captivate hesitant, cost-concerned buyers. However, many individuals who accept these buydowns may not read the fine print of the agreement, which states that these are temporary rates, not permanent, and are often tied to that home builder’s lending entity of which they also profit from. Often, homebuilders will offer 2-1 buydown – this means that during year one of living in the home, a buyer’s rate will be 2% lower, then 1% lower the second year, before the buyer assumes the full rate during year three, which lasts the remainder of the loan. These are prepaid interest subsidies – not true long-term affordability tools. After the initial years, the buyer’s payment jumps, and unless they refinance (at what could be a higher rate), that deal can feel a lot less attractive. The long-term financial impact may not be as competitive as one a buyer might find if they had shopped for a mortgage individually.
Strategies and Perks for Existing Home Sellers to Stay Competitive
Despite the flash and incentives from builders, resale homes offer real, lasting advantages, especially when positioned strategically to preserve as much of the home’s value as possible.
Location, Location, Location
The location of a home is a differentiating factor that sets properties apart and one that existing home sellers can use to their advantage. Existing homes are often located in central or more mature main neighborhoods, near established schools, desirable amenities, bustling retail, hospitals and public transportation. Many buyers prefer to live in communities that are close to work and don’t require high commute times. New builds are often located in developing areas, and buyers end up sacrificing convenience for affordability. However, the costs of transit add up and can push a buyer to seek out an existing home within a developed community closer to the heart of the Phoenix metro area.
Turnkey Outdoor Living
When a buyer tours a newly built home, it can be daunting to open the patio door and be faced with an unfinished dirt backyard. If a newly built home has had its yard developed, landscaping is often done only in front of the property, or it has xeriscaping meeting the minimum HOA requirements. Existing home sellers have the benefit of a property being more likely to have a backyard with mature landscaping, as well as sought-after amenities like cared-for pools and casitas. When purchasing an existing home, buyers are acquiring an already curated space without having to invest additional time and money to make the backyard hospitable. When selling a home, the property owner should keep up on landscaping both the front and back yards, as having these spaces manicured and ready for use can be an attractive draw to a buyer.
Make Cosmetic Changes
There are countless affordable cosmetic updates that a home seller can make to boost their property’s curb appeal and stay competitive with new builders. If living in the home while it is being sold, a home seller might opt for neutral, sparse décor with clutter and personalized home touches stored away until the property sells. Occupants might work with a realtor to have their home professionally staged, allowing a buyer to imagine life inside the property with room to envision their personal belongings on walls and shelves. Cosmetic updates, like fresh paint, lighting upgrades, and new flooring, can make a resale home feel new again.
Builders have marketing budgets and model homes. But resale sellers have location, lifestyle, and move-in readiness on their side. In a market that’s shifting back toward balance, those qualities matter more than ever.
With smart pricing and thoughtful presentation, resale sellers can absolutely compete – and win – in today’s Arizona housing market.
If you are interested in hearing more about how to stay competitive and sell your property with minimal concessions and shortened closing time, visit https://homesmart.com/ to find a licensed, educated agent in your area.
Author: Lauren Fox is vice president of marketing for HomeSmart.
