New Geography

Tag: Arizona

  • Tucson: Missing A Million

    Census Bureau estimates in 2008 indicated that the Tucson metropolitan area had become the nation’s 52nd with more than 1,000,000 population. A Bureau of the Census estimate released earlier this week placed the population in 2010 at 1,027,000.

    However, the 2010 census count showed the Tucson metropolitan area to have only 980,000 residents, a 16.1 percent increase from the 844,000 population in 2010. The historical core municipality of Tucson gained 6.9 percent from 487,000 to 520,000. This is the slowest growth rate since the 1850-1860 census period. The city accounted for 24 percent of the metropolitan area growth.

    The suburbs grew at a rate of 29.1 percent and accounted for 76 percent of the population growth over the period.

    This is the second time in history and the second time in five years that the nation has “lost” a metropolitan area with more than 1,000,000 population. The first instance was New Orleans, which was ravaged by Hurricane Katrina and dropped below 1,000,000 in 2006 and then recovered to above that figure in 2007. At the current growth rate, it appears likely that Tucson will be restored to major metropolitan area status by 2012.

  • Obama Throws Life-Line to Smart Growth Areas

    President Obama has announced a special program of assistance for home owners in the five states that have been hit hardest by the housing crisis. The proposed program is targeted at California, Florida, Arizona, Nevada and Michigan, where house price declines are more than 20% from the peak of the bubble.

    The greatest losses occurred in California, Florida, Arizona and Nevada (see note), where peak to trough house price loses exceeded 40% in all 12 metropolitan areas over 1,000,000 population except Jacksonville. These markets accounted for 70% of the gross housing value loss in the nation before the Lehman Brothers collapse. House prices were driven to unprecedented levels of up to four times historic norms by overly prescriptive land use regulations (“growth management” or “smart growth”) that makes land unaffordable.

    Average losses were more than $175,000 in the markets of these states, more than 10 times those in traditionally regulated markets such as Atlanta, Dallas-Fort Worth, Houston, Indianapolis, Kansas City and Cincinnati. These intense losses were beyond the ability of the mortgage industry to sustain and it is generally acknowledged that this precipitated the Great Recession.

    Smart growth had nothing to do with the Michigan price collapse. There, the strong economic downturn pushed prices down even as the state escaped without a housing bubble.

    The President’s program means that the nation is now paying twice for smart growth policies. The first payment was, of course larger, which cascaded into the huge household wealth losses in the Great Recession.

    Note: While Las Vegas and Phoenix are sometimes perceived as not having prescriptive land use policies, the Brookings Institution ranks both metropolitan areas as toward the more restrictive end of the regulatory spectrum. These overly prescriptive regulatory environments are exacerbated by the fact that in both metropolitan areas much of the developable suburban land is owned by government, and is being auctioned, though at a rate less than demand. These factors combined to drive auction prices per acre up nearly 500% in Phoenix and nearly 400% in Las Vegas during the housing bubble.