Why experts say Arizona housing crisis is a ‘growing cancer’
The housing crisis in Arizona can be defined in many ways. Let’s start with a few numbers:
According to the real estate website Redfin, the median sale price for a Phoenix home rose from $325,000 in January 2021 to $404,300 by October 2021, a 24.4% increase.
The average rental property, in real dollars, was $1,034 in 2017. Today it’s $1,537 — and that’s expected to rise to $2,475 in five years if demand continues to outpace supply.
READ ALSO: Arizona No. 2 for largest house price appreciation
Economist Elliott Pollack told azcentral.com that “this is the worst housing supply/demand imbalance I’ve ever seen. We’re at the precipice of a very serious problem.”
It’s not waiting for the market to self-correct, according to Rashad Shabazz, an associate professor in Arizona State University’s School of Social Transformation.
“We can no longer believe the market is going to take care of this,” Shabazz said. “We can’t have all housing be market-driven. That’s not working, and it hasn’t worked at the beginning. The belief the market is going to correct itself, is going to be the savior … that’s the reason we’re here in the first place.”
Panel looks at Arizona housing crisis
Shabazz was the moderator Thursday in a panel discussion put on by ASU’s Project Humanities to discuss Arizona’s affordable housing crisis. For 90 minutes, the panelists delved into the reasons for the crisis, the impact on homelessness and what needs to be done to address the problem.
Camaron Stevenson, managing editor of the Copper Courier, a civic communications outlet in Arizona, and previously the director of communications at the Arizona Housing Coalition from 2018–2020, said part of the problem is the lack of regulation on landlords.
“There’s no requirements at the state, local or national level for landlords to provide housing at certain price points,” he said. “Their only obligation is to get as much money as they can out of the house.”
Stevenson also cited the number of corporations that are buying homes. In 2021, corporations purchased 31% of single-family homes in Arizona, according to CoreLogic, a California-based data analytics firm.
“If you have everything you need to buy a home, you have the loan lined up, the down payment ready to go and you can make a $1,500 a month mortgage, but a large corporation buys the house for cash, there’s nothing you can do, and then you’re renting from that corporation for $2,000 a month,” Stevenson said.
It’s not just a question of affordability but accessibility.
“In 2018, people could have a bought a house. But with the same resources, the same means, the same amount of money they’ve saved, there are not houses available today to pursue at that price point,” Stevenson said.
“Then they might look at other options, places where housing is more affordable but with less accessible services or the school systems might be worse for their kids,” he said.
Nic Smith, vice president for real estate development for Chicanos Por La Causa, said the crisis is in part attributable to the fact supply hasn’t met up with demand. From 2001 to 2010, more than 487,000 new housing units were built in metro Phoenix. From 2011 to 2020, that number decreased to 240,000. Meanwhile, 880,000 new residents are expected to move to the Valley this decade.
But, Smith added, the housing industry is an easy target and home prices are reflective of other societal problems, a point echoed by Joan Serviss, executive director of the Arizona Housing Coalition.
“If you want to drill it down to the simplest nature, houses are going up in price and wages are oftentimes either stagnant or, because of inflationary factors, going down,” Serviss said. “That’s causing an impact not just in evictions but by folks living precariously, working double jobs just to keep up or living on the streets.”
Stevenson called the housing crisis a “growing cancer” that began with discriminatory practices like redlining – “it specifically targeted Black, Latinos and people of color” — but has spread to every segment of society except for the wealthy.
“It’s everywhere,” he said. “People that you see who are unhoused, asking for money or setting up encampments, that’s such a small portion of people who don’t have a place to live. People are living with family members temporarily or living in cars or motels or hotels because they can’t save up enough money for a deposit or they have a conviction on their record.
“Just because someone doesn’t have a place to live or is living out of their car doesn’t mean they don’t have a full-time job. That’s not uncommon. Fifteen or 16 bucks an hour, that pays for food and gas, but that’s not going to get you housing. You see examples of folks working hard and doing everything they can to provide for themselves and their family and it doesn’t really matter.”
Shabazz said one of the hidden costs of the housing crisis is its impact on the environment.
“People are having to drive 30, 40, 50 minutes or even an hour-and-half each way to work every day because the center of economic activity in the Valley is the central corridor and they can’t afford to live there.
“It means people have to get from Maryvale to downtown, or Apache Junction to downtown, and it has this deep carbon impact. It makes our already hot city hotter and produces more smog in a smog-filled city.”
A woman attending the event asked if one possible solution is to allow zoning for cheaper micro homes.
“Right now, frankly, the demand isn’t there,” Smith said. “To propose a project with 200-square-foot or 300-square-foot homes, you have to have a whole lot of people willing to live in a small living space.”
More practically, Stevenson said it’s important for tenants to not only educate themselves as to what rights they have but to advocate for change in the state legislature.
“Find out who represents you and ask for ways to keep landlords in check,” he said. “Right now, there’s no limitations on what landlords can charge, what rent increases can be or how much time they have to give you before you have to move out.”
Stevenson also said it’s critical that public defenders are made available for tenants who are being convicted.
“Over 90% of tenants have no legal representation when they go to court,” he said. “But if someone has legal representation, it drastically increases the chance somebody won’t be evicted.”
The panelists all agreed on one fact: There isn’t an easy or immediate fix for the current crisis.
“The contradictions between work-market forces and the lack of available housing are really conspiring to place people in a very precarious position,” Shabazz said.