High-paid out-of-state remote workers contribute to rising Tucson rent prices

Since the pandemic, Tucson rents have increased twice as fast as local workers’ incomes.

Yet, many new neighbors who relocated to Tucson during the pandemic to work remotely remark on the affordability of the market.

Paid by employers from San Francisco, Portland and Seattle, for example, the workers’ incomes are much greater than the Tucson-based workers, which has led to confusion and resentment from local employees about rent prices.

“For white-collar workers earning high salaries, remote work is a huge financial boon. It enables them to move from a tech center to a more affordable part of the country, get more home for their money and save some for a rainy day,” said Redfin Senior Economist Sheharyar Bokhari. “It can have the opposite effect on locals in those destinations — especially renters — who are watching from the sidelines as home prices skyrocket while their income stays mostly the same.”

Always considered an affordable market, Tucson is a magnet for remote workers and for investors because the rents are below the national average with room for increases.

The average rent in the Tucson market is now $1,595, an almost 40% increase since the pandemic, but rents have increased almost everywhere.

The average rent nationwide is around $1,800, and more than $2,200 in the states that saw the largest exodus of people since 2020.

Homebuyer income has grown by nearly 20% in Arizona, but that only captures those homebuyers who took out a mortgage.

Many new Tucson residents, meanwhile, sold $1 million-plus homes out of state and a luxury rental of $4,000 a month is less expensive than their previous mortgage.

According to the U.S. Bureau of Labor Statistics, remote worker migration contributed to 60% of the increase in home purchase and rental prices.

“The go-to explanation is supply and demand,” said local economist George Hammond. “In the past decade there was very little housing built relative to our population growth.”

Back to homepage

Subscriber Login

Keep reading with a digital access subscription.

Subscribe now

The appeal of Arizona is the climate and lower cost of living.

“The state we draw from the most, by far, is California and we’re still very affordable compared to that market,” said Hammond, director of the Economic and Business Research Center in the UA’s Eller College of Management.

The median household income in the Tucson metro area is about $51,000, according to the American Community Survey by the U.S. Census.

In 2023, the share of affordable homes in the Tucson area for a median household earner was 38.2%, the first time in 15 years that the affordable index fell below the national average of 40.1%.

By comparison, less than 3% of homes in Southern California are affordable to residents making the median income.

That has led to a spike in demand for rentals.

While many rent out of necessity, many transplant residents rent for the lifestyle, which has contributed to rising rent prices.

“The solution is to build more housing,” Hammond said. “Tucson is a very attractive place to live and work – that’s the reality.”

Development of rental units for the middle class are underway throughout the Tucson area, spearheaded by the city of Tucson, Pima County and the private sector.

In 2023, construction of thousands of new housing units, for all types of renters, began and could help stabilize rental prices, but no significant declines are anticipated.