While increases in the housing market can be felt across the state, Chandler renters have faced a particularly turbulent market — a Rent.com report published in May found the city at the highest national increase in rent for two-bedroom apartments.
According to Rent.com, the city claimed the highest increase rate nationally at 68.6 % in year-to-year rent for two-bedroom units. In the May report, Chandler beat out cities like Miami, Portland, Salt Lake City and Nashville for the title.
“Arizona is a victim of its own success,” Chandler City Councilmember Matt Orlando said. “People want to move here so now we have to create dwellings to be able to accommodate those individuals, but we’re running out of room.”
The city of Chandler is at roughly 93 % buildout, leaving little room for further developments. Orlando said the city is seeing a compounding issue: there is a shortage of land to add more housing units, but more and more people are moving to the city.
Pandemic worsens pre-existing housing concerns
Kathleen Banister, an associate broker at Mountain Sage Realty, specializes in assisting people relocating to or from the greater Phoenix area. She said the current real estate environment is “rapidly changing,” partially due to an influx of people who flocked to Maricopa County during the COVID-19 pandemic.
“During the first two years of the pandemic Maricopa County saw around 300 a day migrating in, which has now slowed to over 100 people a day,” Banister said. “Chandler is consistently attracting new industry and the job market remains strong.”
City officials and housing experts say the Valley already did not have enough supply of affordable housing for residents prior to the pandemic—the issue has only been further exacerbated by rising rents and low single-family home inventory, pricing more and more people out of housing.
“There is not a single bullet that will solve the housing crisis in Arizona,” said Tom Simplot, director of the Arizona Department of Housing. “Instead, it requires a close look at all of our local ordinance and zoning processes and state laws and financing mechanisms to find a path toward building enough housing to accommodate our continued growth in Arizona.”
Simplot said the state has never experienced a shortage in housing like it is experiencing today.
The U.S. has a shortage of 7 million rental homes affordable and available to extremely low-income renters, whose household incomes are at or below the poverty guideline or 30% of their area median income, according to a 2022 report from the National Low Income Housing Coalition. Only 36 affordable and available rental homes exist for every 100 extremely low-income renter households, according to the report. Extremely low-income renters face a shortage in every state and major metropolitan area.
Additionally, Arizona needs 270,000 additional homes overall to tackle its housing crisis, according to the state’s housing department.
“The whole idea and culture of how we live our lives in our homes has changed so dramatically just in the past three years and that coupled with explosive and ongoing growth—there’s no way we could meet the amount of housing needed,” Simplot said. “And our mechanisms for approving new housing at the local level were created to address a problem back in the ’90s to slow growth. Now it’s just slowing the pace of new development.”
Elliott Pollack, CEO of Elliott D. Pollack and Company, an economic and real estate consulting firm in Scottsdale, said the housing market is “a mess” at all levels—from low-income to luxury.
“The world has changed dramatically in a very short time,” Pollack said. “Interest rate payments on the same house in November is now 52% higher than it was six months ago. That prices a lot of people out of the market and forces them to look at the next level or two down. … Basically, you have less demand for single-family, and if someone can’t afford housing, they will rent; and then you have rents increasing and more and more people fall off the ladder. We will see a lot more people [experiencing homelessness] because of all this.”
Mark Stapp, the director of real estate programs at Arizona State University’s W.P. Carey School of Business, seconded Pollack’s concerns that people will be pushed out of their housing brackets and seek lower levels of housing prices.
“When you can’t afford option A, you look at option B,” Stapp said. “If option B isn’t doable, you look at option C. But if option C isn’t affordable either, where do you go?”
Seeking a solution
Stapp said the increase in costs is not a problem exclusive to any one city.
“It’s a regional problem, not a Chandler problem,” Stapp said. “Regional problems require regional solutions.”
According to a report from StorageCafe, Chandler, Gilbert and Scottsdale have built almost exclusively luxury apartments for the last decade. Chandler ranks second nationally in high-end apartment construction, with Gilbert ranking first and Scottsdale ranking forth. Stapp said developers are often vilified in conversations about affordable housing availability, but this anger may be misplaced.
“In order to make projects feasible you have to charge a certain rental rate and right now, that’s what we’re seeing with the luxury developments,” Stapp said. “Developers can’t develop affordable housing projects without regulatory and significant support, and financing for affordable housing is extremely competitive.”
Creating more access to affordable housing will require support from city, regional and state officials, Stapp said, to create more robust support for financing housing.
“If cities want to fully realize their expansion potential, they have to support their employees,” he said. “This is about creating opportunities for those who work in these facilities to live a fair, healthy and prosperous life.”
Orlando said that Chandler officials have been pushing for more affordable and workforce housing projects in recent times to combat the rising prices. This means working with state legislators and creating partnerships to explore further options for Chandler residents.
One of the paths city officials are exploring is changing their “four corners” retail strategy. During a population growth period in the early 2000s, the city placed retail stores on all four corners of intersections, often anchored by grocery stores or other bix-box entities. Now that the city sees an oversaturation of retail space and lack of housing options, Orlando said one of the four retail corners will eventually be repurposed for housing.
“The goal is to create access to multi-family housing developments where they logistically make sense,” Orlando said.
Orlando said other solutions, such as seeking partnerships with school districts to use vacant land, collaborating with landlords for housing voucher programs and adding mother-in-law suites to existing housing properties are all being explored.
“If we continue working with state legislators, we can come up with some creative ways of making more space,” Orlando said. “There are paths we can take and I’m glad we’re taking them.”
Katelyn Reinhart
Reporter |
@ReinhartKatelyn
kreinhart@iniusa.org
Katelyn Reinhart graduated from Arizona State University’s Walter Cronkite School of Journalism and Mass Communications. A longtime resident of the Valley, she specializes in community coverage — bylines include The Arizona Republic, Community Impact Newspaper, Artzbeat and more.
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