2024 marked a year of sustained demand in Arizona’s housing market as inventory remains limited and demand is high from continued population growth. With 2025 on the horizon, the Arizona REALTORS® is forecasting the housing projections for the year and the impact of 2024 as they expect increased activity in the market and interest rates to slightly stabilize.
“The presidential election has created a pause in the market for the past three election cycles, which we saw again in 2024,” says Sindy Ready, 2025 Arizona Association of REALTORS® president from RE/MAX Excalibur in Scottsdale. “While interest rates aren’t expected to drop dramatically, we are hopeful for slight adjustments. As they stabilize, this is encouraging buyers and sellers to re-engage with the market heading into 2025.”
Shane Cook, 2025 first vice president of the Arizona REALTORS® from eXp Realty in Chandler highlights the pent-up demand that the 2024 housing market created among buyers as they adjusted to elevated interest rates. Cook anticipates this demand will lead to increased transactions in 2025, though the extent of the increase will likely depend on interest rate trends, with continued appreciation expected across the Valley.
Lisa Paffrath, 2025 president-elect from Better Homes and Gardens Real Estate Grand View North in Flagstaff, further echoed a home price increase.
“Rural markets like Flagstaff and Northern Arizona are highly desirable and home prices are expected to rise due to strong demand,” says Paffrath. “Sellers in markets with stable home prices or longer listing times amid current interest rates should consider adjusting prices in 2025 if their homes linger on the market.”
As demand for homeownership continues to outpace renting in Maricopa County, Paul Baker, 2025 treasurer of the Arizona REALTORS® from RE/MAX Fine Properties in Scottsdale is confident that the Valley’s population will continue to grow as he expects generational patterns to emerge through new housing additions and market activity.
“Even with moderate interest rate reductions, younger families will stay in the market as buyers regardless of rates and new construction projects,” says Baker. “Also, new construction projects will continue to gain momentum, particularly among younger buyers who are drawn to the idea of ‘new’ and are willing to drive a little farther to get it.”
Ready has also noticed an uptick of multigenerational homes, such as parents moving in with kids or adult children moving back home, which she expects to see more of in 2025.
“As more families are moving in together, floorplans are evolving to provide more privacy and comfort for multigenerational living, featuring a second primary bedroom or an ensuite bedroom,” says Ready. “Open concept floorplans remain a top request from today’s buyers. The combination of an open kitchen and family room, as well as the primary bedroom and bathroom, have long made the biggest impression on prospective buyers.”
Despite inventory challenges, Scott Drucker, CEO of the Arizona REALTORS®, echoes the importance of housing and commercial developments which will lift supply constraints in Arizona for prospective homebuyers while also providing an economic boost through job creation in construction, architecture, engineering, and related fields
Shifting workplace trends may also create new opportunities for homebuyers to enter the market.
Paffrath notes, “As more employers require their employees to return to the office and the traditional nine-to-five schedule, we may see additional inventory on the market in 2025 as workers move closer to their corporate offices.”
Above all, the Arizona REALTORS® emphasizes the importance and value of having a REALTOR® on your side in your property search to provide access to localized information and the up-to-date knowledge on market trends that you need to navigate the complexities of a real estate transaction in 2025 and beyond.
