Is the Valley the next Detroit?

Meaning 40% of the Valley's economy is tied to real estate, and real estate is getting wiped out.

When such a huge percentage of a city's economy is tied to just one industry, and that industry falters, the results are disastrous. It has happened before in history, but as usual, no one learns from history, and instead they let it repeat itself over and over.

Arizona is no exception. Instead of trying to build a diverse economy, it simply hung onto real estate for its life, and now the result is going to be the death of Arizona's economy.

We can already see it happening. Once-busy restaurants are looking dead on weekends. Retail sales are WAY down. High-end establishments are packing it in ... Scottsdale's only 5-star restaurant is closing, and others like Mastro's Steakhouse are being sold off. Of course, this is all because Scottsdale's only disposable income came from the so-called "housing ATM" ... people who would refinance and take out home equity lines of credit to get spending money. The housing ATM is now over, and it's time to repay.

This is the end, people. You can't hang 40% of your entire state's economy on one industry and expect to survive when that industry collapses. Even the illegals are leaving and going back across the border because there are no more easy-to-get construction jobs. A sales manager at one of the department stores told me all of their new hires are former realtors who either lost their jobs or gave up. And let's not even get started on the mortgage industry ... those jobs are GONE.

Get out of Arizona while you can. This is going to end very, very badly.

Comments

[Steve-O]

Living it up on the west side and am looking forward to the show.
How do I define living it up?
1. $134,000 house with 10 years left on a 15 year fixed loan (5.375%)
2. Have one car payment (2007 Toyota SUV)
3. Paid off all credit card debt
4. I am self-employed with health insurance ($140.00 per month for me and my beautiful wife)
5. Speaking of beautiful wife - She is home with me cooking, cleaning, taking piano lessons, crocheting, napping and loving having quit her job (shrugged). She was doing very well financially in the rat race, in her cubicle, losing her hair and her mind.
6. I maybe pull $5-$8000 a month. Its called living within your means on a budget.
We have moved beyond being obsessed with wealth. Not that we don’t want it, but have put ourselves to better use. Finding out what really matters. My business is only 3 years old, and I am not looking to get rich quick. Slow and steady growth is the name of the game. Hard work. Period. I am only 35 years old, I have the time. And this is a fun journey.
My business is directly tied to the coming apocalypse here in the valley. How could I be smiling my "what me worry" smile? My wife and I have fashioned a lifestyle that requires little money to take care of the necessities when necessary. I have the skills to make the small amount of money we need to get by. I can fix anything in a house, I can build furniture, I can play depressing songs on the guitar, I can mix a mean drink, and I can sell anything. I have spent years actively pursuing these skills for fulfillment and as potential sources of income. I will clean toilets at night at the community college if that what it takes. My work ethic requires such action in times of need.
Why am I writing all of this down? Not to brag, but to tell people to stop putting themselves over a barrel. Stop looking for the quick, easy buck. Material things are fine, but actually pay for them! With actual MONEY.
The things you own don't own you. The things you OWE own you.
Get it together people; the hard lesson is just beginning around here.
As for me, schadenfreude is the word. (Just because I have some empathy doesn't mean I can't be a dick).

[Keith]

Anyone truly interested in seeing the results of an economic tsunami like you described really needs to go online and check out Detroit - it is positively scary that this could happen in our country - everyone send thank you cards to your favorite union delegate and pandering liberal politician that decreed over the last three decades that a lack of education or ambition certainly shouldn't keep you from earning stupid money and getting lifetime benefits and pensions for banging on hubcaps.

If there was a "Scottsdale" of Detroit, it would be Grosse Point and surrounding - it has been totally decimated with the UAW to blame. You can buy a 3 acre, 10,000 sf home on the lake with a private dock, guest and servant quarters,10 car garage etc... for less than $2m - and it's been on the market 400 days! This particular home cost the current owner $9m in 1995 - there's no one to buy it! You can no longer earn a living in Michigan, so no one will move there!

If you look in urban areas, you find HUNDREDS of listings on Realtor.com for abandoned, mostly burned out, properties in Flint, Dearborn, Detroit,Etc for next to nothing - I saw some recent sales for less than $5000 for a 1400sf 3 bedroom home -$5000!!!Who would have imagined that most of Detroit proper would be a modern day ghost town if you asked them 30 years ago - Flint is so deserted it is creepy - it's like that old Charlton Heston movie, "the Omega Man".

You are right on track here - putting all your economic eggs in one basket is suicide with our political climate in this country. Be it automobiles, spring training baseball, real estate and construction - anytime we rely on one or two income and tax sources, failure is eminent.It happened to Detroit, Cleveland in the 70's and 80's, Pennsylvania from the 70's through today - even Vegas had to expand and diversify to get out of the economic hole the 80's created.

Arizona has a few bright spots that may pull us out as a state - aviation, electronics, medical field, lab testing, trucking to name some - but what does Scottsdale have? Nothing but photo radar and a golf tournament - ok, maybe spring training, but I havent bought in on how taxpayers paying for all that makes economic sense - EVERYTHING else is based on housing - furniture stores, decorators, real estate and mortgage offices, remodel contracting, big box retailing - if those all close, Scottsdale is once again a bedroom community like it was in the 70's - and maybe that would be a change for the positive, as you would have to already have money to get in the door...

[Small Hat]

Wait a minute...I thought Scottsdale was Detroit. You mean it isn't yet? I think it may be worse...

Can we talk about the heat? it is 8:55 p.m. and I just got back from walking my dog...it is still too hot to be outside.

God I hate this place...please everyone say a prayer that my husband is able to find a new job soon and we can sell our house here. I am begining to wonder if we will ever get out.

[Keith]

Since we are bagging on Detriot too, I have a friend that left Iraq in the 70's to get away from Saddam's government. As alot of Iraqi's did, he settle in Detroit. Just he few weeks ago he had me rolling when he told me " I have traveled the world - lived in Iraq, Jordan, Europe, South America and the USA - the only place worse than Iraq was Detroit..." By the way, he lives in Scottsdale now since the late 80's - how's that for being born under a bad sign.

[angryman]

Monday Morning... i can't breath again. dust... smog...fires looming.

Cowboy Caio sucked... the crowd was so loud and obnoxious, I had to ask the hostess to move our table. She moved us 10feet... and when I asked to be further..she gave me attitude. Fuck her and the horse she rode in on. And Cowboy Caio was not nearly as good as it used to be... food was not as good.

Meanwhile...Old Town Scottsdale nightlife is OFFICIALLY as scummy as Tempe.... And Tempe... has sunk to new lows.

The women in our group did not feel safe, and there were skeevy people cruising old cars wearing hanes tank tops (aka wifebeaters..aka guinea T's) Even the 'Sugar Rays'(mark mcgrath wanabes) have morphed into KFeds.

Disgusting.

This place is so dead.

Meanwhile there are HUNDDREDS...if not thousands of condos being built north of Desert Ridge marketplace.... Toscana from 260s and a new one from the 300s... who would pay that.

2 restuarants are out of business at Desert Ridge too.. .the Italian restaurant and Bahama Breeze. DOA. RIP.

But the 'genius' developers are bulding CITY NORTH.... just what we need more crap...a lower class version of Keirland...

Speaking of Keirland... i don't see much buying going on at keirland... some, but mostly the money is spent on food there.

maybe Kyl and Mccains illegal alien buddies will buy some condos post amnesty. doi. doi duh.

Went over to the Bently/AstonMartin/Ferrari/Lambo dealer at Penske Auto mall... not many cars selling... they sold on lambo a few weeks ago and a AsontMartin 10 days ago...

What blew me away was how the 2 Ferrari 360 Modenas had only 5700 miles on them... what Fucking posers... i bought one, I'd put atleast 16k miles a year on it... i'd drive it to the hardware store to pick up charcoal.
Landrover dealer....had 3 hot ass gold digging girls in there all with guys with DG tshirst... these guys were gonna lease their 'tail' a Rover Truck. pathetic... the men and women.

[Keith]

Funny and oh so true! Thats the "new" prostitution in Amexica - I mean America - sorry - Rather than spend $100 a shot on overpriced Scottsdale call-girl BJs, convince one of these brain-dead N.S. bimbos youre a "playa" and lease them a $400.00 a month, no money down car - it's like getting a two for one deal on the BJs! I had a North Scottsdale poser aquaintance - tiny tract home on a tiny lot in Grayhawk (otherwise known as a North Scottsdale "estate") backing up to a shopping center, the requisite H2 and striped shirts,spiky hair, weekly teeth whitening, etc - he was smarter than most - he leased some bimbo a Jetta for 199.00 a month and she thought he was the acting boss of North Scottsdale...until the 4th equity loan in three years ran dry and he couldn't afford the Jetta and sold it out from under her - this little topless dancer in training that grew up in N.S spray paint grafitti'd his house - that's the class acts you Scottsdale schmucks have living around you...

FRANK'S COMMENTS: Funny stuff! But you're forgetting that the losers who pay for all this stuff never actually get laid, except maybe once a month or so to keep them hanging on. Guys who are attractive to women don't need to buy them shit to get sex.

I can't tell you how many times, while living in Scottsdale, I got this phone call at midnight: "The loser who took me out to dinner at Ocean Club just dropped me off, wanna come over and have some fun?"

I also know guys who are really good with women who will go out in Scottsdale, watch losers buy a girl drinks all night, then 10 minutes before closing time, when the girl is good and drunk, sweep in and take her away from the loser Scottsdale drink-buying guy.

I've also been out with girls in Scottsdale, who, when I say "I need another drink," they go up to the bar and let some loser midlife-crisis Scottsdale guy pay for it ... MY drinks!! LOL!!!!