Keller Williams Arizona Realty

15333 N Pima Rd., #130

Scottsdale, AZ 85260

T 480.767.3000

F 480.629.5105

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Metro Phoenix had 4th-highest rise in rental rates in U.S., but 10K new apartments are on the way

 Catherine Reagor, The Republic |

It’s getting pricier for the convenience of calling your landlord when the AC breaks, the internet is down or the swimming pools needs cleaning.

Rents are on the rise in metro Phoenix, particularly in infill hot spots in Phoenix, Scottsdale and Tempe.

The Valley’s average apartment rent has climbed 22 of the past 23 months, according to national research firm Axiometrics.

The average apartment rent in the Phoenix area is now $924, according to the rental data firm RealPage. That’s about $70 more than it was a year ago.

Demand for rentals surged during the housing crash when so many people lost homes to foreclosure and had to rent.

Adding to that already big pool of renters are Millennials who aren’t ready to or don’t want to buy homes.

But higher rents are also bringing more apartment construction.

Apartments leading the way for homebuyers

Tempe launched the Valley's latest apartment development spree a few years ago, when new high-end complexes started going up around the city's lake and Arizona State University.

Now, long-vacant prime parcels idowntown and midtown Phoenix are sprouting new apartment complexes. And older buildings in central Phoenix and Scottsdale are being torn down to make way for new apartments and condominiums.

  • Tom Simplot, CEO of the Arizona Multihousing Association and a former Phoenix councilman, told me apartments lead the way for people to buy homes in an area.

    "People first became comfortable living in central Phoenix by renting," he said. "Those of us living downtown are no longer urban pioneers, and we welcome all the new people and growth, whether rental or homeowners."

    Rents are climbing in many big U.S. metros, but Phoenix saw the fourth-biggest U.S. increase in rents during the summer, per RealPage stats. Sacramento was No. 1 with an almost 10 percent jump. Portland and Seattle saw increases of more than 8 percent.

    Phoenix’s almost non-stop increase during the past two years is a bit unusual.

    “Two years of almost nothing but increases in average rent is just about unheard of, given seasonal cycles and volatility in most metros,” said Stephanie McCleskey, vice president of research for Axiometrics.

    She cites the Valley’s job growth as a big reason behind the area’s long streak of rent increases.

    About 70,000 new jobs were added in metro Phoenix during the past year.

    And now there aren’t a lot of empty apartments to choose from in the Valley. Only about 5 percent of the area’s rentals are vacant.

    Salaries are also climbing in the Valley, but not as fast as rents.

    The average rent on a Valley apartment is up almost 8 percent from last year.

    Wages are up 2.4 percent in metro Phoenix, according to the U.S. Bureau of Labor Statistics.

    Developers are upping apartment amenities to draw more people willing to pay higher rents.

    Yoga studios, dog parks and washing stations, coffee bars and resort-like swimming pools are becoming the norm in the Valley’s highest-priced apartments.

  • Scottsdale-based apartment owner Mark-Taylor recently added Amazon Lockers in many of its Valley complexes. The lockers let online-shopping renters pick up their packages anytime.

    Mark-Taylor executive Chris Brozina said the lockers are there to make renters' lives “more convenient.”

    High-end apartment renters pay for the conveniences as well as location. Rents at some new infill complexes in Phoenix, Scottsdale and Tempe can run as high as $2,000 for a one-bedroom.

    In the second half of 2015, before a few new complexes opened up in the area, downtown Phoenix had the highest average apartment rent in the Valley.

    What could make the lives of many renters easier is a lower monthly payment.

    Complexes with more than 10,000 apartments are currently under construction or planned in the Valley. Most are upscale developments in popular neighborhoods.


    If there aren’t enough people lining up to lease the many new apartments, then rents could dip.


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    KW Phoenix Apartment Group

    15333 N Pima Rd., Suite 130

    Scottsdale, AZ 85260

    T 623.466.5849

    F 480.629.5105

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