Real Estate Agencies

Near the end of a two-hour economic forum with more than 150 real estate agents, Tucson City Manager Mike Letcher laid out his plan of action to reverse the city’s financial troubles. At every opportunity, he said he is going to meet with department heads, managers, “and everybody that touches a customer, that we need to focus on being more business friendly.”At first, his comments drew some bemused murmurs from the crowd.A business friendly City of Tucson?

At a realtors’ forum, Tucson City Manager Mike Letcher (left) and Marana Town Manager Gilbert Davidson discussed how the recession has forced governments to change their operations. Roger Yohem photo ADVERTISEMENT But when Letcher emphasized – with great emotion – that he was going to deliver the message personally and not rely on administrators to spread the word, the room burst into thunderous applause.Facing a “new financial reality” spiked with budget deficits, employee layoffs and spending cuts, municipal governments have been forced to change their operations. That was a key message delivered by University of Arizona economist Marshall Vest at the forum, the 2011 Tucson Association of Realtors Economic Summit on Jan. 27. The forum also included town managers Gilbert Davidson of Marana, Jerene Watson of Oro Valley and Jim Stahle of Sahuarita to discuss economic development around the region.Vest set the tone for the summit, explaining that the weak housing market and public sector budget issues will be a drag on the region’s pace of recovery. His research shows that the both entities won’t be able to solve their fundamental problems until about 2014.“Nationwide, the recovery is over. The U.S. economy is now expanding. We have recovered all the ground that was lost during the recession,” Vest said. In Arizona and Tucson, “we are lagging behind the rest of the nation, just bumping along the bottom. We are waiting for the recovery to get started. The headwinds for us are housing and the public sector which is shrinking, cutting spending, and laying off employees.”Arizona and Tucson’s “unique problem” is an enormous inventory of vacant houses. Statewide, there are about 130,000 empty homes, over 27,000 in the Tucson metro area alone. Vest analyzed this data from the U.S. Postal Service.Plus, population growth is near zero and into-the-state mobility is at a 60-year low. Nearly half of all Arizona homeowners are in negative equity positions.Locally, Vest explained the numbers behind unemployment. More than 30,000 jobs were lost in Tucson during the recession and there are now 40,000 unemployed trying to find work.  Unemployment is “painfully high at 8.3 percent.  There is no job recovery in Pima County,” he said.       In the outlying areas, Stahle, Gilbertson and Watson all explained how their towns have adjusted to the down economy with layoffs, new long-term strategic plans and a unanimous claim that they are all “open for business.”In Oro Valley for example, the mayor and city council have reached out to the development community.  Watson said they have met with 18 developers to discuss the town’s new attitude toward commerce.“Our reputation for being a very difficult community to do development has definitely changed.  We changed procedures that knocked off about a year in the development review and permitting process,” Watson said.Stahle said Sahuarita’s future economic strength will not depend on retail and construction.  The town’s economic plan ensures that new business ventures will see “no roadblocks from us.”In Marana, Davidson said the town’s “proactive, aggressive” spending cuts has left it in a financially stable position.  The town took advantage of the slow times to host forums and meet with private businesses on relocations, job creation and training.He said the quickest way to restore the town’s economic health is through job creation.  Part of their plan is to streamline the entitlement process for developers, work with entrepreneurs and help all business “get through processes quickly and efficiently while meeting all the rules.”“By all indications, Marana will be a tremendous future investment area,” he said.Stabilizing home prices Fiserv Case-Schiller is the first company to step out and project a definitive end to the nation’s and region’s devastating five-year slide in home prices: They will hit bottom in the second quarter of this year.During 2010, average home prices in Tucson fell by 7.3 percent. For 2011, prices are expected to dip another 2.8 percent before reaching their lowest points in the second quarter. Beginning about July, Fiserv expects price stability in the area to get some traction and start to hold.Fiserv Case-Shiller Indexes track home price trends in over 375 markets and to-date, home prices have leveled out in about 25 percent of those areas. Cities that have started to stabilize include San Diego, San Francisco and Washington, D.C.By year-end, price stability is projected to reach 75 percent of all markets and will include Minneapolis, New York, and Portland, Ore. By the end of 2012, Fiserv predicts a 100 percent recovery across the country. Among the last metro areas that will see stabilization are Phoenix, Las Vegas and Miami, Fla.As the markets stabilize, the data indicates that the recovery in home prices will have “many false starts,” especially in markets like Tucson, with high unemployment and heavy foreclosures.Tucson 38th for foreclosuresThe 2010 year-end housing stats from RealtyTrac are in and the only real question is where Tucson ranked nationally in foreclosures? It had the 38th highest ratio in the nation; one in every 29 housing units.A total 14,480 homeowners in metro Tucson received notices of foreclosures last year. Tucson’s ratio was was worse than cities including San Francisco, Portland, Ore., and even recession-ripped Youngstown, Ohio.The nation’s highest foreclosure rate was in Las Vegas, with one in 9 units being noticed. The other top five cities, in order, were Cape Coral, Fla.; Modesto, Calif.; Phoenix-Mesa; and Miami, Fla.The Phoenix-Mesa area recorded 124,720 notices of foreclosures, or one in every 14 units. That impacted 7.3 percent of all homes in the market.RealtyTrac is an online marketplace for foreclosures and the data is from its 2010 Year-End Foreclosure Market Report.  Overall, foreclosures increased in 149 of 206 markets tracked by the firm.  Each of the 10-highest foreclosure markets of 2010 however, posted fewer filings compared to 2009.Long Realty absorbs ZipRealty ZipRealty’s 30 sales agents have been merged with Long Realty Company and will operate out of Long’s Foothills office at 4051 E. Sunrise Drive.  The move will benefit both companies as ZipRealty brings its extensive website and technology expertise to a company that is a high-profile market leader.In 2010, the ZipRealty closed about 260 units.  Long’s Foothills office is managed by Laura Mance.