Thanks to “slower-than-expected job and population growth and a bigger glut of home foreclosures than expected,” experts at the Urban Land Institute Arizona conference last week pushed metropolitan Phoenix’s housing recovery out another year. Now, the latest forecasts indicate that “the Phoenix area won’t recover to pre-boom levels until 2015[1]. In 2009, the group predicted a recovery by 2012, and in 2010 the forecast was for 2014.

The analysts determined that the housing recovery will remain slow until “enough new jobs are created to attract tens of thousands of new residents annually to the region again.” As is the case throughout the country, high unemployment remains, in Phoenix, a dominant factor in the struggling real estate market[2]. Furthermore, experts at the conference came to the consensus that the area is probably only about halfway through its “foreclosure problem,” which means that if current trends continue, nearly 300,000 houses in the Phoenix area of Arizona alone could ultimately be repossessed by lenders.

The conference’s theme this year echoed concerns, with the think tank focusing on the mantra “It’s all about jobs.” Gadi Kaufmann, a managing director at a Washington, D.C. real estate consulting firm, stated the issue very simply: “No jobs, no housing market recovery.” The median price of homes in the area has fallen more than $50,000 since 2003, and home prices are not expected to rise this year. However, said Kaufmann, they could start climbing by “five to seven percent a year starting in 2012.”

Based on these predictions, while the situation is dire for Phoenix area homeowners, the time is ripe for real estate investors to start looking at this area for good deals and growth potential. Are you currently investing in Arizona real estate? What is your strategy?

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[2] http://www.azcentral.com/arizonarepublic/news/articles/2011/01/28/20110128phoenix-housing-market-recovery-struggles.html