A growing cohort of custom buyers in Arizona is driving up land costs in the state, placing the region's priciest cities on par with ultra-luxe housing hubs in states like California and Colorado.
In Paradise Valley, a sought-after neighborhood with Arizona's largest cluster of high-end residences, ready-to-build lots come at a premium. The town had 31 lots for sale as of Aug. 18, with prices ranging from about $800,000 to nearly $10 million, according to Homes.com.
More buyers are flocking to towns such as Paradise Valley and Scottsdale in pursuit of building a custom dream home, brokers say.
"Arizona is experiencing a dramatic shift in its luxury real estate landscape, with sales figures now aligning with those seen in Beverly Hills, Aspen and Silicon Valley," said Sabrina James, an agent with Serhant, in an interview with Homes.com. "Price points that once belonged only to Manhattan high-rises or oceanfront estates are now being achieved in the desert’s most desirable areas."
In the past year, there were 30 lot deals in Phoenix totaling over $100 million in sales volume, averaging about $3.3 million per transaction, according to Andrew Turley, president of appraisal firm Phoenix Valuations. That outpaces the prior year, when 28 lots traded for about $89 million, or $3.1 million per sale. Turley compared deals that took place between Aug. 11, 2023, and Aug. 11, 2025, for this story.
"It should also be noted that what’s driving these price increases is wealth creation locally," Turley told Homes.com. "Wealthy homeowners generally prefer to be closest to other wealthy homeowners, [and] we see this all over the United States."
Spike in value and volume
Serhant's James saw evidence of Arizona's land demand last month, when she brokered a deal for a 1.3-acre lot in the exclusive Silver Sky community for $5 million in Paradise Valley, just two days after the parcel hit the market. The buyer, DNP Builders, plans to build a $20 million spec home aimed at car collectors.
Since that deal closed, five additional lot sales in Paradise Valley have traded hands for more than $1.9 million, according to Homes.com.
Experts say the recent land sale prices will have a direct impact on the end product that gets built.
"The result is fewer mid-tier builds, more ultra high-end spec homes and heightened urgency among developers and end-users to secure the few remaining parcels before land costs escalate further," James said.
Nearly 6% of the inventory in the Paradise Valley neighborhood consists of homes valued above $2.4 million, compared to just over 1% across the Phoenix metro, according to Homes.com data.
Where the priciest deals occur
Paradise Valley has a rare combination of privacy, prestige and proximity that appeals to affluent buyers, James added.
"Most of the prime land was developed decades ago, and the remaining parcels are often older home sites being torn down for new builds. True vacant land in Paradise Valley and Scottsdale is exceptionally scarce," James said.
That was the case in the sale of 4701 E Arroyo Verde Dr Unit 3, a lot that sold in July for $3 million. Chris Karas of Compass, who represented the seller, told Homes.com the lot previously held a home that was torn down.
The prior owners purchased the site for $2.25 million in 2022 and drew up plans to build a custom home. But when their "perfect house" came on the market, they abandoned the project and sold the lot at a premium.
Turley said he divides Paradise Valley into seven different submarkets. The Silver Sky market, between Mummy Mountain and Camelback Mountain, commands some of the priciest land prices.
"The choicest of these markets for most upper-echelon pricing is between, where the view corridors are most iconic, and the access to exceptional supporting infrastructure is world-class," Turley said.