Market Spotlight: Phoenix, Arizona

Phoenix, Arizona, has been buzzing for a while now and for good reason.  Nicknamed the “Valley of the Sun,” the Greater Phoenix area is mostly known throughout the world for its climate, which averages 300 days of sunshine with an annual average temperature of 75 degrees.  

But did you also know that the Phoenix metro area is increasingly known for its relatively low taxes and business-friendly regulatory climate?  Read on to find out more reasons why Phoenix is one of our favorite markets to invest in right now. 

 

Why We Love Phoenix

Along with its great quality of life (hello sunshine and snow-free winters!), Phoenix offers numerous attractive incentives for investors. The Phoenix metropolitan area is a vibrant community and tech business hub, attracting new residents and businesses alike. Today, the region is home to 4.95 million residents and continues to be on a trajectory of grow. The U.S. Census Bureau has estimated that by 2030 the population of Phoenix will reach 2.2 million, with the metro area reaching about 6.3 million. 

The Phoenix MSA is the second fastest growing metro in the nation and ranks 5th in total population. The metro remains attractive not only because of its competitive advantage regarding cost, but also because of an overall value proposition, which includes its talent pool, quality of life and infrastructure. This attracts both new residents and the new businesses that will sustain and increase employment options for those new residents.

This infrastructure includes the robust Valley Metro Rail system connecting throughout the metro area and also includes two major airports – Phoenix Sky Harbor and Phoenix-Mesa Gateway Airport. Phoenix Sky Harbor airport alone services 46 million passengers annually and is ranked the 13th busiest airport in the country. 

With our love for traveling, warm weather destinations year-round, and booming economies – it’s no surprise that we love Phoenix.

 

Where Is Phoenix, Anyway?

Phoenix is located in the south central portion of Arizona about halfway between Tucson to the southeast and Flagstaff to the north. The Phoenix metro serves as an optimal location due to its proximity to the major markets of neighboring and nearby states such as California and Texas.  

Phoenix Is A Western Hub: Rails and Roads

Companies that distribute throughout the western and southwestern U.S. and Mexico benefit from the Phoenix area’s location, as well as its highway and rail infrastructure that connects Arizona to 65 million people throughout markets in California, Colorado, Nevada, New Mexico, Texas, and Utah. The major cities in these neighboring states are within a one-day truck haul, like Las Vegas, Albuquerque, Los Angeles, San Diego, Denver, Salt Lake City, and more. 

New freeways within the Phoenix metro have recently further connected residents with jobs and amenities. The South Mountain Freeway, completed in 2019, connects the east and west valleys of the Phoenix Metro area.

 

Why People Are Moving To Phoenix

 With a competitive advantage regarding property costs, talent, and quality of life, Phoenix is uniquely attractive to businesses. Large corporations in the trade and transportation industries have moved in, as well as the education and health services industries – all to support the population growth.

Efforts to diversify the Phoenix economy, market its strengths, and make the region a friendlier place to do business have paid dividends. Today, the Phoenix metro area is increasingly known for its relatively low taxes and business-friendly regulatory climate, including being a landlord-friendly environment. 

The weather is ideal, the location is convenient, the recreation is versatile, and the golf is simply unbeatable (along with the hiking, biking, and other outdoor activities) making the lifestyle highly desirable. This all means that the real estate is next to none.

Phoenix’s Job Growth

Arizona is expected to add nearly 550,000 jobs between 2019 and 2029, according to a study released May 6, 2022 by the Arizona Office of Economic Opportunity

According to the Arizona Commerce Authority (ACA), the state ranked No. 3 for economic outlook going into 2023 — a 10-spot jump from No. 13 the prior year. With manufacturing and semiconductor development scores such as Kohler, KORE Power, Lucid, Intel and Taiwan Semiconductor Manufacturing Company (to name a few) as well as tremendous traction in autonomous vehicle manufacturing, and dottings of retail and hospitality activity across multiple areas of the Valley, it’s no wonder the state’s economy largely flourished in 2022.

In addition to the expected amenities of a business hub, such as abundant transportation solutions, adaptable land and a highly skilled workforce, perhaps the most enticing of Phoenix’s characteristics for tech-focused enterprises is the prominence of Phoenix’s data center landscape.

In recent years, Arizona has emerged as a major destination for webscale, cloud and large enterprise companies. Phoenix, in particular, is one of the country’s fastest-growing and most dynamic regions for tech business growth, particularly in three major industries: satellite telecommunications, electronic manufacturing and aerospace. Businesses in Phoenix are met with operational costs of up to 36% less than California, a major incentive for companies seeking sites for headquarters.

All of this shows the diversity that we here at Goodegg Investments like whenever we’re considering a market. Being investors ourselves, we are always looking for ways to mitigate risk, and for overall industry and job diversity.  The Phoenix market helps us do just that.

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Exponential Rent Growth

Phoenix saw a staggering 29% increase in rents in 2021, making it one of the top 10 cities in the country for fastest growing rents, and with the high ongoing job growth, rental demand will remain strong. This rental boom has created a unique opportunity to renovate assets in prime locations and are in need of cosmetic upgrades.

With Phoenix a hot spot for migration it’s no wonder that the rent growth will keep pace as well. While there are slow downs going into 2023, across numerous markets across the US, we’re confident that Phoenix will continue its strong growth.

 

Why You Should Consider Investing In Phoenix

Here at Goodegg Investments, our value-add strategy will benefit the new professionals and families relocating to the metro. They’re actively looking for a place to call home that is recently upgraded and includes new lifestyle amenities, while exploring the numerous activities Phoenix offers.   

Overall, the Phoenix market is incredibly strong and still has so much potential. If you’re looking for new markets to invest in to build and diversify your portfolio, we highly recommend you look into Phoenix. 

And if you’re an accredited investor looking for passive investment opportunities, we invite you to invest alongside us in Phoenix assets and other top real estate markets around the country.

To get started, apply to join the Goodegg Investor Club today.

 

Next Steps

Here at Goodegg Investments, we have a variety of options for you to help you learn about and invest in real estate so you can take advantage of the cash flow, equity, appreciation, and tax benefits. Below are a few resources to get you started.

Invest Now

If you’re accredited and ready to invest right now, we invite you to check out our open deals page to learn more about our current or upcoming opportunities.

Learn More

If you’re not yet ready to invest but are curious about how all of this works, we invite you to dip your toe in the water with us through our free 7-day email course – Passive Real Estate Investing 101 – or to get a free hardcover copy of our book – Investing For Good.

Connect With Us

If there’s ever anything we can do to help you on your journey, feel free to email us at [email protected] or call / text us at (888) 830-1450.

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Want to invest alongside us? Take a look at some of our current and upcoming offerings.

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