Phoenix Condo Prices Hit a Three Year Low in 2026: What Buyers Should Know

Phoenix condo prices just hit their lowest point since the first quarter of 2023. Median condo sale prices in the Valley slipped through the second quarter of 2026, with condos down about 2.3% and townhomes down roughly 7.8% for the year, according to Cromford Report data. Single family prices in Metro Phoenix have been close to flat over that same stretch, so the discount is concentrated almost entirely in attached housing.

That gap is the whole story. If you have been priced out of a single family home in Scottsdale or North Phoenix, the condo and townhome side of the market is where your money goes furthest right now. But condo financing has its own rulebook, and buyers who skip that part tend to find out the hard way about two weeks before closing.

Why Phoenix condo prices fell while houses held steady

Condos dropped because supply and carrying costs both moved against them at the same time. Investor demand cooled off hard after the 2020 to 2022 run up, when Phoenix condo values climbed roughly 70% in two years. A lot of that buying was speculative, and when short term rental returns flattened and rates stayed near 7%, those owners became sellers.

At the same time, HOA dues and insurance premiums across Arizona associations have climbed sharply. A buyer looking at a condo is underwriting two payments, the mortgage and the HOA, and when dues jump a hundred dollars a month, the price has to come down for the deal to pencil. Sellers adjusted. Single family owners with 3% mortgages mostly did not have to.

The broader Valley market backs this up. Metro Phoenix is sitting firmly in buyer territory, inventory is running above 2023 and 2024 levels, and seller concessions are common across the Valley. Redfin put the Phoenix median sale price around $460,000 in August, up about 1.7% year over year, with homes averaging roughly 55 days on market. Detached housing is stable. Attached housing is on sale.

What a condo actually saves a Phoenix buyer

Real money, if you run the whole payment and not just the price. A condo priced $80,000 below a comparable townhouse style single family home saves roughly $500 a month in principal and interest at current rates. Property taxes and insurance usually run lower too, since you are insuring the interior rather than a full structure and lot.

The offset is the HOA. Valley condo dues commonly land between $250 and $600 a month depending on the community, and dues count against your debt to income ratio exactly like a car payment. So a $500 monthly savings on the loan can shrink to $150 once dues are in. That still works for a lot of buyers, especially first timers, but it needs to be modeled before you write an offer, not after.

One more piece people miss. Special assessments. If an association is underfunded and votes in a roof or plumbing assessment, that bill lands on you as the owner of record. Ask for the reserve study and the last two years of HOA minutes during your inspection period. Weak reserves are the single best predictor of a surprise assessment.

The financing piece: warrantable versus non warrantable

Your rate and your down payment depend as much on the building as on your credit. Conventional lenders review the whole project, not just your unit. They look at investor concentration, delinquent HOA dues, litigation, commercial square footage, and reserve funding. Projects that clear those tests are warrantable and price like a normal loan. Projects that fail move into portfolio or Non-QM territory, usually with a larger down payment and a higher rate.

Arizona has a lot of older condo stock and a lot of former apartment conversions, so this comes up constantly in Phoenix and Tempe. The fix is simple: have your broker order the condo questionnaire early. At Pillar Mortgage Group we run project review before you are deep into an inspection period, because finding out a building is non warrantable on day 25 of a 30 day escrow is an expensive way to learn.

FHA has its own approved condo list plus a single unit approval path for individual units in unapproved projects. VA maintains a separate approved list. Those two programs open up low down payment options on condos, but only in buildings that qualify, which is another reason to check the project before you fall in love with the unit.

Is this a good time to buy a Phoenix condo?

If you plan to stay put five years or more, the pricing is the best it has been since early 2023 and sellers are negotiating. If you are buying to flip inside of a year, the same softness that created your discount will still be there when you try to sell. Condos historically lag single family homes on the way up in the Valley, so this is a live in it and hold it play, not a quick appreciation play.

Ready to see what is actually listed? Browse current Valley inventory at Arizona Luxury Property Search, and compare what you find against nearby single family listings on Homes.com so you can see the spread for yourself. Then get the payment modeled with dues included before you tour anything.

Frequently Asked Questions

Why are Phoenix condo prices falling in 2026?

Investor selling, higher HOA dues, and rising association insurance costs pushed condo values down while single family prices stayed roughly flat. Median condo prices in Metro Phoenix hit their lowest level since the first quarter of 2023, with condos off about 2.3% and townhomes off about 7.8% on the year.

Do HOA dues count against you when you qualify for a condo loan?

Yes. Lenders add the monthly HOA dues to your housing payment when they calculate your debt to income ratio. A $400 monthly due reduces your buying power by roughly $60,000 to $70,000 in loan amount at current rates, which is why the HOA number needs to be in the conversation from day one.

What is a non warrantable condo in Arizona?

A non warrantable condo is a project that fails conventional guidelines, usually because of high investor ownership, HOA dues delinquency above 15%, pending litigation, too much commercial space, or underfunded reserves. These units are still financeable through portfolio and Non-QM lenders, typically with 15% to 25% down and a higher rate.

Can you buy a Phoenix condo with an FHA or VA loan?

Only if the project is on the HUD or VA approved list, or the unit qualifies under FHA single unit approval. Plenty of Valley condos do qualify. Check the project status before you write an offer, because approval is not something you can add during escrow.

How much do you need to put down on a condo in Arizona?

On a warrantable project, conventional financing starts at 3% down for a primary residence and 10% for a second home. FHA runs 3.5% down on approved projects. Non warrantable buildings generally require 15% to 25% down through a portfolio lender.