Spiraling Down In Phoenix


Not much time tonight but I want to pass along a couple of statistics on Phoenix real estate I caught this morning on the radio. Sorry, no links but if you want to follow up you might try Arizona State University’s web site. The comments are from Jay Butler, a professor there who runs their real estate studies department.

  1. Residential foreclosure activity around 50,000 units now versus 28,000 in 2008 and 10,000 in 2007.
  2. The recent spate of activity at the low end of the market has been driven to a large extent by investors. He estimates 40% of sales or thereabouts were made by investors and expects them to be remarketing in two years or so.
  3. He thinks office vacancies will approach 30% in 2010. Apartment vacancies to spike somewhere in the range of 15%. Industrial to be similarly impacted.

Put that together with this article from Clusterstock about the desperate fiscal situation facing the state and you get the picture. By the way, the Clusterstock article fails to mention that the state is taking in about $22 million a day in revenues and spending about $28 million.

Arizona and Phoenix are basked cases and their predicament doesn’t necessarily apply nor can it be extended to other parts of the country. It’s not a canary in the coal mine either but it might be at least a cautionary tale about how far we have yet to go.

You can leave a response, or trackback from your own site.

Leave a Reply