Here’s what Valley economists say about possible Phoenix housing market plunge

Jan 27, 2023, 4:25 AM

(Photo by Justin Sullivan/Getty Images)...

(Photo by Justin Sullivan/Getty Images)

(Photo by Justin Sullivan/Getty Images)

PHOENIX – Local economists are saying a recent report projecting a 2008-like plunge in the Phoenix housing market is no reason to panic.

The New York Post reported Tuesday that Goldman Sachs warned clients that the Phoenix; Austin, Texas; San Jose, California; and San Diego markets “will likely grapple with peak-to-trough declines of over 25%” in 2023.

However, Jim Rounds of Tempe-based Rounds Consulting Group said “the economic fundamentals are completely different now” than they were in 2008, when home prices fell 27% nationwide, sparking the Great Recession.

“We’re going to continue to have growth,” he told KTAR News 92.3 FM.

“We’re doing a great job adding employment opportunities for people, and so I’m not nearly as worried. So, ignore that report for now [and] expect home prices to come down a little bit more slowly.”

Danny Court, senior economist with Scottsdale-based Elliot D. Pollack & Company, said the Goldman Sachs projection for Phoenix in 2023 isn’t off base, but he sees it as a correction, not a crash.

He told KTAR News that Phoenix-area home prices have already fallen by over 10% from the May 2022 peak and could fall another 15% this year. That would return prices to the levels from the April or May of 2021.

“I don’t think anyone thought they were getting a good deal in 2021 on their home,” Court said.

“So, really … the reason that the percentages look so drastic is because we had such a drastic run-up in prices. So, this is a small reset.”

Another stark difference from the Great Recession era is the frequency of foreclosures. Court said the Valley had 8,000-10,000 foreclosure notices a month in 2008-09.

“We’re seeing about 200 to 300 a month now, and that’s a completely normal market,” he said.

KTAR News 92.3 FM’s Jim Cross contributed to this report.

We want to hear from you.

Have a story idea or tip? Pass it along to the KTAR News team here.

Arizona News

Stock image of a backyard pool. A 3-year-old child died July 17, 2024, after a drowning incident in...

3-year-old child dead after being pulled from Chandler backyard pool

A 3-year-old child died Wednesday night after a drowning incident at a Chandler residence, authorities said.

1 hour ago

Arizonans are grateful to be in Milwaukee for what they call a "bucket list" and "once-in-a-lifetim...

Danny Shapiro

Arizonans grateful to be in Milwaukee for ‘bucket list’ Republican National Convention

Arizonans are grateful to be in Milwaukee for what they call a "bucket list" and "once-in-a-lifetime" Republican National Convention.

4 hours ago

With her image magnified on the video screen behind her, Kari Lake speaks during the Republican Nat...

Kevin Stone

Kari Lake says her ‘great name ID’ is helpful for fundraising in Arizona US Senate race

Arizona Republican Kari Lake said the fact that she's become so well known has been a boon to her U.S. Senate fundraising efforts.

4 hours ago

Follow @KTAR923...

BOGO camping promotion to be offered at Maricopa County’s regional parks

Starting in mid-September, Maricopa County will bring back its "Buy One, Get One" camping promotion.

4 hours ago

Hole 15 at TPC Scottsdale (Stadium Course)...

Payne Moses

Scottsdale rated among best US cities for recreation, recent study shows

Scottsdale was rated the sixth-best city in WalletHub's "Best & Worst Cities for Recreation (2024)" study released Monday.

4 hours ago

Human trafficking sting in Scottsdale leads to 42 arrests...

42 people arrested during human trafficking operation in Scottsdale

Forty-two people were arrested during a two-day operation targeting human trafficking in Scottsdale, according to authorities.

11 hours ago

Sponsored Articles



Desert Institute for Spine Care is the place for weekend warriors to fix their back pain

Spring has sprung and nothing is better than March in Arizona. The temperatures are perfect and with the beautiful weather, Arizona has become a hotbed for hikers, runners, golfers, pickleball players and all types of weekend warriors.



Here are 5 things Arizona residents need to know about their HVAC system

It's warming back up in the Valley, which means it's time to think about your air conditioning system's preparedness for summer.


DISC Desert Institute for Spine Care

Sciatica pain is treatable but surgery may be required

Sciatica pain is one of the most common ailments a person can face, and if not taken seriously, it could become one of the most harmful.

Here’s what Valley economists say about possible Phoenix housing market plunge