Best Places in Phoenix Real Estate Market for Your Next Deal

Phoenix, AZ real estate market

Read Time: 8 Minutes
2/13/2025

Where Should You Buy in the Phoenix Real Estate Market?

Thinking about investing in the Phoenix real estate market? Great choice! Phoenix has been one of the hottest real estate markets in the country for years, thanks to its strong job growth, steady population increases, and a warm climate that keeps attracting new residents.

But here’s the thing: not every neighborhood is a great investment. I’ve been in the real estate game for a long time, and I can tell you from experience—if you don’t do your homework, you could end up in an area where rents are stagnant, crime is rising, or property values are going nowhere.

So, how do you avoid those mistakes? By using a data-driven approach to evaluate neighborhoods. That’s exactly what we’re going to do today using the RECAP method—a system I use to find the best places to invest based on Rents, Employment, Crime, Appreciation, and Population growth.

Why Use RECAP Analysis?

One thing I always tell new investors: gut feelings don’t cut it in real estate. You need to look at hard data to make smart decisions. That’s why I developed the RECAP formula to evaluate investment areas based on five key factors.Appreciation trends in Phoenix Arizona real estate market

Here’s how it works:

Rents

Rule of Thumb: Target areas where monthly rent is less than one-third of the median income. This ensures you’ll always have a solid pool of renters who can afford the area. (See why rent data matters) The rent comps pulled in this article are 2 bed/1 bath.

Data Source: RentOmeter

Employment

Rule of Thumb: Look for areas with at least 10% job growth over the past 10 years, a diverse economy, and no reliance on a single major employer. (See why job diversity matters)

Data Source: U.S. Bureau of Labor Statistics

Crime

Rule of Thumb: Avoid areas with high rates of weapon violations, assaults, property crimes, and vehicle theft. (See why crime patterns matter)

Data Source: CrimeOmeter

Appreciation

Rule of Thumb: Stick to areas with at least 2% annual appreciation (5% is preferable) and no value declines for two consecutive years. (See why appreciation matters)

Data Source: Realtor.com

Population Growth

Rule of Thumb: Target areas with at least 10% growth over the last decade and no population decline for two consecutive years. (See why population trends matter)

Data Source: U.S. Census Bureau

Top Neighborhoods in the Phoenix Real Estate Market

Now that you know how to analyze a market, let’s dive into three Phoenix neighborhoods that stand out based on my RECAP analysis.

Job growth and employment trends in Phoenix, AZ market1. Arcadia – A High-Demand Area with Long-Term Value

If I had to pick one neighborhood that consistently performs well in the Phoenix real estate market, it’s Arcadia. This area has everything you want as an investor—high demand, great schools, proximity to major job hubs, and beautiful homes that keep appreciating in value.

Most people looking for high-end rentals or fix-and-flip opportunities look to Arcadia. Rent demand remains strong because tenants here are typically higher-income earners who can afford the area, and appreciation rates continue to rise.

The only drawbacks from this market is the population growth and high cost of housing. This zip code has remained relatively stagnant in regard to population, with roughly the same population since 2016. Additionally, due to the high appreciation, homes cost so much that flippers may be the ones to thrive best here.

RECAP Analysis Results:

  • Rent: PASS
    • Rent is 21% of median income
  • Employment: PASS
    • 26% job growth, diverse sectors
  • Crime: PASS
    • More mild crimes in central Arcadia
  • Appreciation: PASS
    • 11.24% annual average
  • Population: FAIL
    • -0.46% growth since 2016

Final Verdict: If you’re looking for long-term value and appreciation, Arcadia is one of the best places to invest in the Phoenix housing market.

2. Downtown Phoenix – A Stable Market with Opportunity

Downtown Phoenix has completely transformed over the past decade. If you asked me 10 years ago whether I’d invest here, I might have hesitated—but today? Things have changed.

With major employers moving into the area, population consistently going up, and more people wanting to live close to work, stability in this market is strong. The only downside I would caution is that crime can be dense in some areas, and the rental rates have decreased recently, so you may struggle to get high rents on your properties.

RECAP Analysis Results:

  • Rent: PASS
    • Rent is 28% of median income
  • Employment: PASS
    • 26% job growth, diverse sectors
  • Crime: USE DISCRETION
    • More crimes, but still ranging from low to medium intensity except in southeast Downtown where less crime occurs.
  • Appreciation: PASS
    • 10.33% annual average
  • Population: PASS
    • 102.50% growth since 2016

Final Verdict: If your goal is consistent appreciation and stable demand for housing, Downtown Phoenix needs to be on your list of possible areas in the Phoenix housing market.

Phoenix, AZ population growth trends in real estate market3. West Phoenix – A Unique Opportunity

I always tell investors: don’t just look for what’s hot today—look for what’s becoming hot next. That’s exactly why West Phoenix is on my radar.

This vibrant district has performed great over the past few years, despite some nearby zip codes doing worse. With rising property values nearby, good affordability at present, and the potential to ride greater appreciation on this market’s strong fundamentals, I highly recommended considering this area as one of Phoenix’s best places to invest.

The only downside to West Phoenix is the rental rates compared to income. Although we’d prefer rents to be less than 30% of the area’s median income, 31% is close enough that depending on your risk tolerance this market could bring some great deals.

RECAP Analysis Results:

  • Rent: FAIL
    • Rent is 31% of median income
  • Employment: PASS
    • 26% job growth, diverse sectors
  • Crime: PASS
    • More crimes, but still ranging from low to medium intensity with less crime in west part of West Phoenix.
  • Appreciation: PASS
    • 13.90% annual average
  • Population: PASS
    • 13.94% growth since 2016

🔎 Final Verdict: If you’re looking for an overall great performer with major appreciation potential, West Phoenix is one of the best emerging neighborhoods in the Phoenix real estate market.

Ready to Find Your Next Investment Property?

The Phoenix real estate market offers fantastic investment opportunities—but only if you know where to look. Using RECAP, we’ve identified neighborhoods that don’t just look good on the surface but have the fundamental strengths for long-term growth.

  • Want high appreciation and stable tenants? Arcadia is your best bet.
  • Want stability and consistent appreciation? Downtown Phoenix is where you should look.
  • Want to get in early on an emerging hotspot? West Phoenix is your next big opportunity.

Successful investing isn’t about following the crowd—it’s about making data-driven decisions based on real numbers.

That’s exactly what BrightInvestor helps you do.

👉 Start analyzing Phoenix neighborhoods today—sign up for BrightInvestor here!