Anchorage Real Estate Market Trends
ANCHORAGE, Alaska (KTUU) – Difficulties in providing affordable housing for residents of urban areas is not only an issue in the Lower 48, but also exists in Alaska.
With housing shortages in the market, low interest rates, higher rents, and record selling prices, the housing market in Anchorage has changed dramatically in recent years. Potential and current owners wonder whether or not the more affordable prices will return.
“You would think we don’t have land issues, but here in Anchorage, of course, we do. We’re surrounded by ocean and mountains and there’s not a lot of affordable, available, developable land in the Anchorage Bowl that’s available to builders and developers and that’s becoming a problem,” Droege said.
The number of homes available in Anchorage has dwindled below the number of interested buyers. Prior to the COVID-19 pandemic, inventory on hand was measured by month. However, real estate inventory is now measured on a daily basis. Century 21 Realty Solutions CEO Michael Droege said the housing market is currently at a 17-day turnaround, which means if no more homes come on the market, inventory will run out.
Droege said land issues are a contributing factor. Anchorage also suffers from a lack of space and supply chain issues, which further complicates the construction of new housing. Rising oil prices have also exacerbated the problem, affecting petroleum-based products such as roofing and carpeting.
Homes stay on the market much shorter, which has also pushed up prices for increasingly determined buyers. State economist Neal Fried said the median cost of a single-family home in Anchorage in 2020 was $394,000, which has since jumped to $430,000.
“Last year we built the fewest number of new homes since 1989. 1989 was a long time ago, and our population in 1989 was significantly lower than it is today, so we’re not adding a lot of new housing in the Anchorage market. Even statewide, we’re not adding a lot of new housing,” Fried said.
Fried said it’s impossible to determine if and when the housing market might return to a more typical price range.
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