Phoenix-area condos have dropped in price, but the bigger issue is the monthly payment, not the price tag.
How far prices have fallen
The 15% figure covers the city of Phoenix only. It does not describe the greater Phoenix metro area or all of Maricopa County, and it does not apply equally to Scottsdale, Chandler, Gilbert, Mesa, or other nearby cities, which have their own market conditions.
For comparison, Phoenix overall saw a 6.3% year-over-year decline, to $295,000. Downtown fell faster.
Prices in parts of the Phoenix area, including Phoenix and Mesa, rose sharply in the years before 2022 and 2023, with some reported gains as high as 350%. Against that run-up, a 15% drop is a correction, not a crash.
Why it’s happening, biggest cause first
Many condos carry high HOA fees. Add today’s interest rates, and the monthly payment is out of reach for many buyers. Roughly, $500 a month in HOA dues can cost a buyer about $80,000 in purchasing power on a single-family home, so many buyers are choosing houses instead.
Since the Surfside collapse, Fannie Mae and Freddie Mac have required stricter standards, including questions that show whether an HOA is well managed. Some Phoenix-area HOAs have not answered them. When a building doesn’t qualify, buyers can’t use a low-down-payment conventional loan, so the unit often sells to cash buyers at a discount.
The rules are tightening again. Fannie Mae is preparing a stricter path to condo financing in 2027.
To meet the new rules, many HOAs have raised fees and charged special assessments, which reduces demand for condos.
Newer higher-end apartments compete with condo rentals, and the vacation-rental boom may have peaked. Rental demand is shifting toward apartments.
What this means for buyers
A 15% discount is not a deal on its own. If HOA dues are rising faster than rents, the price can keep sliding no matter what you pay.
The best opportunity is a complex that doesn’t qualify for standard loans today but is working to fix that. You buy at the cash-buyer discount and refinance once the building qualifies. If the HOA isn’t making progress, you may be left selling to cash buyers.
What this means for sellers
If your condo qualifies for standard financing, that now carries real value, and it can be part of how we price your home. Before we list, I recommend gathering three documents:
Have a condo question?
Message me or call me, and I’ll help you read your building’s HOA numbers and what they mean for buying or selling.
A note on the data: the 15% decline is for the city of Phoenix only, measured from the August 2022 peak through August 2026, using the Zillow Home Value Index for mid-tier condos. It is not a figure for the greater metro area, all of Maricopa County, or Scottsdale, Chandler, Gilbert, or Mesa, which have their own market conditions. Scottsdale, Old Town, and McCormick Ranch may be holding up better. The luxury segment (over $1 million) is a different market. Market conditions change, so please confirm current numbers before making a decision.
This article is general market information, not a home valuation, appraisal, or financial or legal advice.
