Metro Phoenix’s median home price has shot up more than 30 percent in the past year. The number of houses for sale is at a six-year low, and realistically priced homes are drawing dozens of offers, mostly from investors.
Popular press like this reflects but also shapes the conventional wisdom and the conventional wisdom has a huge influence on the demand for Phoenix real estate.
Demand for Phoenix real estate will increase as these stories seep into the general consciousness and the fear of falling prices fades.
The demand for Phoenix real estate is determined in part by what those with a lot of information about the Phoenix real estate market think about the market, but the market is also determined in part by what those without a lot of information think about the market. These stories affect both groups.
These stories should make those with a lot of information more confident that Phoenix home prices will continue to increase.
For the less informed general public a story like this will displace some old story they remember about people losing a ton of money buying real estate. They become slightly less fearful about buying a Phoenix home.