Last week, the Arizona Republic’s Catherine Reagor reported on December’s housing market in Phoenix. Sales were down MOM (unremarkable) and listings fell (also unremarkable). It was nothing you wouldn’t expect this time of year. There were two sentences, however, nonsensical enough to be fun. The first:
Metro Phoenix’s housing prices continue to rise, but the supply of affordable homes for sale also needs to climb for the market to continue its recovery.
It looks like Reagor is equating “rising home prices” with “recovery”. However, the claim is that there needs to be a greater supply of affordable homes for this to continue. Supply is low because homes have been held back from the market. A greater supply of affordable homes would, in fact, stall rising home prices. Unless Reagor has a different definition of “recovery”?
The other sentence:
Unless new-home builders can start keeping up with the rising demand from buyers, metro Phoenix’s housing market could face a “ chronic supply problem”.
Back in 2005, you couldn’t throw a rock without hitting a new home development. Qualified construction workers were sometimes in short supply. Today, builders have pulled way back. Were construction to take off, workers would pour into Phoenix to fill positions. Builders are quite capable of meeting “rising demand”. If they aren’t cranking out more homes, it’s because it doesn’t make financial sense.
We’ll be tuning into the Republic next month. If the market doesn’t always give us something to smile about, the media spin often does.