Why is AZ rated as one of ten worst run states? (Phoenix: employment, to move)

[Burning Madolf]

Originally Posted by Potential_Landlord

Thanks to finger laker for the explanation. I think that we truly went through a very exceptional situation in the last ten years, so I would have like to see a longer time period for the evaluation.
Again, when I compare to my wife's family in upstate New York, I must admit that Arizona was much harder hit by the downturn, RE and otherwise. I wonder what the explanation is. For example, New York is actually losing residents and property taxes are much higher, yet home prices are more stable than in Arizona and the difference is going up further to the advantage of New York. I wonder where that comes from and it cannot all be Wall Street, particularly in upstate New York. The region was also hard-hit by GE's downsizing.

Real estate wise, some parts of NY and New England will always remain stable because of the lack of explosive growth (simple supply and demand). For example, you would be hard pressed to find anywhere in the northeast like Surprise, AZ where the population went from about 15k to about 100k in just a decade with thousands of new homes being built. In order to find that kind of population explosion (but without cheap lending) and massive home building you would probably have to go back to post WWII or maybe even 100 years ago with the mills and factories (but not so much home buying).

AZ was an "if you build it they will come" state during the bubble driven by a corrupt lending system and time is the only healer of a glut. States like PA, NY, IL, NJ, CT and MA, have enormous debts to pay in the form of pensions and health benefits and again I doubt this survey to that into enough consideration.

[rosco917]

For example, you would be hard pressed to find anywhere in the northeast like Surprise, AZ where the population went from about 15k to about 100k in just a decade with thousands of new homes being built.

This statement is correct, the state I reside in, hasn't grown in population in 10 years, in fact we're loosing population.
I'm an outsider, but I just think Arizona simply over built without the anticipation of a down turn, never mind to the degree the entire Country has experienced.

States like PA, NY, IL, NJ, CT and MA, have enormous debts to pay in the form of pensions and health benefits and again I doubt this survey to that into enough consideration.

Again, this statement is very accurate, pension liabilities in the northeast are strangling these states. In the past jobs and pensions were given away like candy, to anyone who will vote a certain way. Now the Pension liabilities are killing growth. Cities and towns are finding that the Pension funds are less that 25% funded! Unions are taking States, Cities, and Towns to Court to uphold bad contracts from past years.
This is what Arizona has to protect itself from.
Don't forget... even Franklin Roosevelt didn't like the idea of Public Sector Unions with State pension liabilities.

[Ponderosa]

Originally Posted by rosco917

This statement is correct, the state I reside in, hasn't grown in population in 10 years, in fact we're loosing population.
I'm an outsider, but I just think Arizona simply over built without the anticipation of a down turn, never mind to the degree the entire Country has experienced.



Again, this statement is very accurate, pension liabilities in the northeast are strangling these states. In the past jobs and pensions were given away like candy, to anyone who will vote a certain way. Now the Pension liabilities are killing growth. Cities and towns are finding that the Pension funds are less that 25% funded! Unions are taking States, Cities, and Towns to Court to uphold bad contracts from past years.
This is what Arizona has to protect itself from.
Don't forget... even Franklin Roosevelt didn't like the idea of Public Sector Unions with State pension liabilities.

Public sector unions are small and powerless in AZ. The largest retirement system is in pretty good shape, funded at about 78% even after the losses of the past decade. AZ employees pay 1/2 of the contributions to the retirement system. The contribution rate is actuarially deterrmined every year and is now over 20% of gross! The government can not defer payments or "borrow" money from the plans under the state constitution which is what happens in the east and why those systems are so deep in the hole. Retirees pay their own health care costs with a small (fixed) fraction from the system. Cost of living increases are based on plan performance. There have been none in nearly a decade.

[Finger Laker]

the future of any defined benefit pension and the funding of them will be an issue for years to come

i also agree with Ponderosa that I doubt AZ will be in the bottom 10 within the next couple of years - there are still some issues, but the opposite side of the bubble will start to play out and things are picking up again .... it also goes to speak, IMO, of the massive need for economic diversity out here and a greater emphasis on education/innovation

as for upstate NY - it was more than just GE that hit that area .... it's been in steady decline most of my life and yes home prices are a lot more stable there ........... a lot of that comes to supply/demand - things there are much more constant .... you don't have desertion/unemployment to the extent of places like youngstown, ohio where everything crashed out

that wasn't so much the issue with AZ as we had a combination of overbuilding combined with a big spike in unemployment/deteriorating economic conditions ............ there was a time during the boom that whole communities would sell out within a week with big lines awaiting the opening day ...... very competative environment (I bought in 2004 and was one of 5 bids the first day of the listing) .... you also had a lot of speculation - I had clients in CA who owned 3-5 homes out here when they had never been to the state

a lot of these speculators couldn't withstand the early downturn and quickly were washed out - you had stock awaiting people to move in, but migration ground to a near halt, then everything snowballed and kept driving prices lower and lower - the foreclosures and builders essentially undercutting their developments helped drive prices even lower creating more distressed homes, more unconventional sales, etc

things are starting to rebound - but things are still a long way away from where they were even in 2000 in many neighborhoods .... rental market is hot right now and a lot of people are going to be on the sidelines for a couple of years

[Cida]

Apart from the fact that you have kind of a culture of laziness and bad faith, you also have a population that regards low taxes as the major factor and overall has no feeling of general public responsibility - the kind of feeling that in other places leads to good public transportation. On top of that, you have an apathetic population and no decent newspapers to either keep people informed, do good investigative work, or write scathing editorials.

[chazk14]

The housing market crashed but really its these liberal news networks that constantly attack Arizona. If you live here like I do, you would know atleast I think its fairing pretty well.

[Burning Madolf]

Originally Posted by Cida

Apart from the fact that you have kind of a culture of laziness and bad faith, you also have a population that regards low taxes as the major factor and overall has no feeling of general public responsibility - the kind of feeling that in other places leads to good public transportation. On top of that, you have an apathetic population and no decent newspapers to either keep people informed, do good investigative work, or write scathing editorials.

Good public transportation. WT........ Scathing editorials??????

[kell490]

What city do you mean you said Arizona city? Do you mean Phoenix? like a lot of city's they have unions which cause a lot of dead weight to stay on the payrolls never understood how labor unions got involved with city worker. I wouldn't say it's the worst, or the best. It's a strange mix the State is basically poor low paid and decapitated buildings. They even sold off the capital buildings and rented them back. The city's are in much better shape the employees get a paid a lot more then county and state employees. The housing boom and bust had nothing to do with the government here it had to do with open flat cheap land maybe easy permitting as well compared to the east coast. It is actually starting to recover I hope in 2013 we see a turn in my home price.

[Ponderosa]

Originally Posted by kell490

What city do you mean you said Arizona city? Do you mean Phoenix? like a lot of city's they have unions which cause a lot of dead weight to stay on the payrolls never understood how labor unions got involved with city worker. I wouldn't say it's the worst, or the best. It's a strange mix the State is basically poor low paid and decapitated buildings. They even sold off the capital buildings and rented them back. The city's are in much better shape the employees get a paid a lot more then county and state employees. The housing boom and bust had nothing to do with the government here it had to do with open flat cheap land maybe easy permitting as well compared to the east coast. It is actually starting to recover I hope in 2013 we see a turn in my home price.

Decapitated buildings? Maybe you meant dilapidated buildings. That would be wrong too for the most part. Really, outside of maybe the older parts of town which are relatively small, one of the most remarkable features of Phoenix is how new, fresh, clean, and nicely landscaped everything looks. I get that from everyone I have ever had come to visit me over the years. I would agree that there is a lot of poverty in this state because of a large native American population and a huge and growing illegal immigrant fraction and limited employment opportunities outside of the two major cities.

[rgscpat]

I would love to see more transparency from local and especially state government, and think that would help government efficiency and leave fewer ratholes for corruption. And, somehow, Arizona is going to have to come up with more support for education if it wants its economy to keep up with the competition.