How is Phoenix going to get rid of that oversupply of empty houses if people are picking up and moving out of the Valley? [Hat tip MR!]
For the first time in modern history, Phoenix’s population could be shrinking.
It’s an idea that would have been unimaginable just a few years ago, when Phoenix was surging up the list of the nation’s most populous cities. Now, a variety of indicators suggest that fewer people are living here than a year ago.
No one knows for sure exactly how many people have moved in or out. But with the 2010 census about to get under way, some indicators suggest Phoenix’s population may be smaller than the projected 1,636,170 people.
City records show declining trends in several key areas. Among them:
• Foreclosure numbers have skyrocketed, meaning fewer city homes are occupied.
• Water hookups are down, suggesting the same.
• Some aspects of trash collection have ebbed because fewer people are buying things that produce waste.
• Crime has declined across the city while police are getting fewer calls for services, a possible indicator of fewer people.
• Sales-tax revenues are likely to drop for the second year in a row, with this year’s collections off almost 8 percent from last year.
A large portion of the Phoenix population are fairly recent arrivals, many of whom moved to the Valley for jobs. While many grow to love the climate and the lifestyle and will try and stay, often people move on to where the jobs are.
This is one more reason to believe that the housing market in Phoenix will be depressed for some time to come.
Wasn’t the depressed housing market the allure of Phoenix?
The sales tax revenue declines tell the frightening story of the housing debacle. Historians will refer to this period as the retail crisis. Hope everybody enjoys Wal-Mart. Thanks fed. You did a great job
Freemonster-
I wouldn’t bet on Walmart either.
I was in Austin at 9:30 last night waiting for my son to arrive at the airport at 11:00. There aren’t a lot of places to wait, so I did something I never do- I hung around Walmart.
I think 90% of what they sell is stuff no one needs, and I doubt the margins are good on the necessities. Everyone is betting they will do better during a recession, but I’m not counting on it.
About two or three years ago, the Arizona DES predicted falling population for Phoenix, for the forseeable future. I sent it around to friends via email. It was a prediction widely ignored, or ridiculed.
Not surprised, except that I’m a little amazed it has come true this early. …
Yossarian-
I moved from the Valley a year ago, and at the time I talked to several moving companies. The companies that handled executive moves said that they still had about 20% more move-ins than people moving out. Companies like U-haul however were saying that the net was out.
M and I have been looking at school district enrollments, which have been falling most everywhere in the Valley.
We’ve been told for awhile that one out of three dollars generated in the Valley were related to housing. While not all housing is dead, losing construction employment is bleeding into other sectors as well. I think it’s possible then that Phoenix could lose 1/3 of it’s economy. If that happens, a lot more people will be moving.
This downturn is going to hurt. A lot.
I just heard California is losing people as well. Michigan has had a migration going on since the automakers have started to fold.
I live in northern Wisconsin once, it was so cheap to live, dirt cheap. The water is clean, air clean, and the people, well mostly nice, oh and the beer was really cheap too.
You found things to do that did not cost any money.
I’m sure Phoenix will be fine in the longer run, I thought Arizona had a preferable climate.
For several years it seemed every city in the US was having people move there. No one ever seemed to know where they came from, though.
None of the stats above actually count people… looking back on it now, I wonder how many towns ended up counting “investors” as part of their population, when those people did not actually live there – they just claimed to for tax reasons or something.
Linenoise-
According to Jay Butler, the methodology that was used for calculating how many people moved in was based in part on the number of homes sold, and he said that there was probably an error in the figures for that reason. That’s one of the reasons that I think that tracking utilities being shut off may overestimate the number of people leaving for that reason. I believe the school enrollment numbers though, I think that’s an actual indication of whether people are coming or going.
Stinky Chinese drywall?
This is just a heads up about a story I read, involving Chinese drywall having a large sulfur content, which not only stinks but is also corrosive. Look to it.
The urban depopulation story should surprise no one. Where did they all come from? Rural areas, of course, where most of the poor live. When there are jobs people move to cities. When the jobs disappear people move back to rural areas.
I’m in the Bay Area, which is NEVER supposed to lose people. But it’s happening. We have a socked in, entitled middle class here, but they’ll get theirs too. By the way, California deficit, now $42 billion (I predicted $40 billion a year ago, and everyone laughed since it as $7 billion), looking at 75-85 billion.
Huge economic downturn in California which NO ONE wants to talk about here. Very corrupt in California, very gentlemen’s agreement to stifle bad news–and then suddenly it all comes out! This new budget new will come out too. Wait and see.
Also, watch out for another thing. Google
supply chain
This is where the economy will really collapse, and shows you the power orientation of Washington. EVERY link of the supply chain is financed. That is not happening now, and with one thing and another, the supply chain is falling apart.
So…shortages? Yes. Inflation because of shortages? Yes.
But Washington thinks it’s only important to put money in banks’ accounts–even though banks are only the U.S. Government itself, behind a fig leaf.
There will be hell to pay now that the economy on the ground is disappearing.
By the way, look for a march on Washington this summer. Obamavilles? Yes. There are already references to it on the web.
Let’s hope they burn down the White House.
Where’s everybody going?
CA always loses people during a recession. During the 90’s recession, the fwy traffic rolled along beautifully. Lots of old cars but they moved for a change. It was pleasant.
Las Vegas has people getting out. I would have moved out a couple hours after I moved in if I didn’t have a husband anchored to the place. I expect to see more folks moving out. Some people love it here and some just plain hate it.
One thing I’ve seen over my two times of living in Las Vegas; if you want out, you’d better get going otherwise you’ll never get out. This place has a way of sucking everything out of you till you just give in and become an old desert rat and pretend you love it.
Cost of living here is off the charts. Daily expenses are high. Dentistry is almost triple what Santa Monica, CA, is and I thought SM was pretty high. In CA, I would meet friends for happy hour once a week – cost me under $20. In LV, same deal is $60! I do it anyway.
I understand the flight to AZ. Many friends and clients chose that path during the 90’s recession, however, many of them returned to CA saying they missed their base.
When SoCal has it’s next earthquake, look out, here they come to Las Vegas, Phoenix, you name it. Anyplace that doesn’t rock.
We moved here in 2001 and loved it because the pace was niiiiice and slooow compared to where we came from. It’s not why we came here, in fact it was a little disconcerting at first. Fast food joints closed at 7pm, lots of stores closed on sundays, restaurants on mondays, the only way to get over to Scottsdale was by way of the Greenway-Hayden Loop. In several different restaurants, the waitress wouldn’t take my plate unless I finished my food! That’s no joke, it happened at Deer Valley shopping center and in downtown Glendale. And let’s not forget open carry, and testicles hanging from the trailer hitch. Yeeehaaaw!!!
Now, my business is dead because it is tied directly to new development. But I’m willing to stick it out, hoping the world’s biggest cowtown comes on back. It’s the character of this place I miss, and only got to experience it for a year or two before things kicked off. Now 30k millionaires, DB’s, and cars washed obsessively. Blech! Go away.
I’m just glad we moved into an established 20+ year old neighborhood inside the 101 ($134,000/1820 sf/2 car garage/block construction wooo hooo!!)
Twist, Yossarian
You called this some time ago. You were right on the mark. I do not doubt that a lot of people thought you were crazy. This site has been right on.
Surak-
I was right on this one, and did take a lot of flack for it. There are those who will tell you though, that doesn’t necessarily prove that I’m not crazy. : )
From what I have read, california is not losing people per-se. While it is experiencing a net US migration out, (more people leaving then coming in from other states)to date this is more than compensated by the difference in births to deaths, and international immigration.
In Arizona, a HUGE contributor to any loss of population, is illegal immigrant self deportation. With the drop off in construction employment, employee laws regarding varifying work eligibility, and the antics of “America’s Stupidest Sherrif” where suspected illegals are harrassed but criminal warrants go unserved, they are simply chosing to leave.
Now, in a real estate led downturn, one might question policies that drive out several percent of the population; One might wonder how increasing rental vacancies will further impact a struggling real estate market. But, apparantly one wouldn’t think about that at all if he/she was ignorant trailerpark mentality lifted truck driving duffus, which describes 80% of phoenix/mesa population.
AZRob-
Back in the 1920s when the economy was booming, the Detroit auto makers [Ford in particular] imported workers from Mexico. [On a personal note, my grandfather was one of them.]
After the market crashed, the government decided that if Mexicans were deported, there would be more jobs for Americans. If you listed your place of birth, or your parents place of birth as Mexico on the 1930 census, you were considered a Mexican whether you were a U.S. citizen or not.
It was considered impractical to enforce a nationwide expulsion, so it was limited to Detroit and southern California. No exact records were kept, but the estimate was around 200,000. [You read a lot about what happened to the Japanese in WWII, but little on this travesty. You can Google the "Repatriation" if you are interested.]
At any rate, Detroit was decimated. Apartment buildings were vacated. Groceries stores were emptied. Retail was decimated.
I wouldn’t advocate just throwing the borders open, but it’s a good idea to consider all the implications before throwing a large segment of the population out.
Heck, even the Governor is moving out. Of course, she has another job lined up in DC.
At a minimum, I expected anemic growth. There are simply fewer jobs, and even fewer good jobs. And how are those underwater in California or Ohio or wherever going to sell their house and move to Arizona for retirement or for non-retirement? Renters and those with sufficient money can still come, but will they want to? Sure, plenty will, but certainly not enough to utilize several years worth of housing stock.
AZROB, “Phoenix murders plummeted 24% in 2008″ – Just sayin’
http://www.azcentral.com/community/phoenix/articles/2009/01/14/20090114homicide0114.html
I’m surprised no one here’s cited the real reason for our Arizona desert’s exodus: Global Warming.
: )