One of the goals of our blog is to keep our readers up to date on how things are going in Arizona. There is a slew of information in from the first quarter of 2011 and some developments that have occurred recently.
One of the biggest issues to begin the year was Arizona Senate Bill 1041. This bill was intended to attract new business, especially ones that would be purchasing property plant and equipment, to Arizona. This bill would have let businesses that meet certain investment standards reduce their property tax to as low as 5% for a decade. Those looking to move to Arizona and those who are already here but wanted to expand obviously loved the idea. Those who have been here and already made investments, in spite of a down economy, were opposed. Governor Brewer vetoed this Bill when it crossed her desk.
Home prices still are not that great here in Arizona. Residents are still seeing declines in the value of their houses, and a significant number of homeowners are still upside down in their mortgages. At the end of the first quarter, just over 68% of the homes in the Phoenix metro area were underwater.
Whether consumers are spending or not says a lot about the economy. A Rocky Mountain Poll this January pertinent to consumer confidence showed that Arizonans were the most confident that they had been in two and a half years. Profit growth from Arizona based companies like PetSmart and local construction firms in the first quarter is another good sign. This contrasts the housing market, but good news is welcome. Retail sales in Flagstaff also showed some very good numbers, with a 29% increase in tax revenues based upon car sales. Big-ticket purchases are always a sign of good things to come.
One of the important portions of our state’s economy is tourism. Restaurants and hotels need this push to get by and reach profitability. Hotels in Scottsdale were among the best in the nation when it came to occupancy (86.9%) and revenue per room ($166.05) this March. That is great news and shows that our states hospitality industry is working past the slight that Arizona’s reputation took due to some of the headlines that made national news.
Things seem to be slowly improving. While it will take patience to fully take advantage of these slow upturns it is great to see a shift toward growth. A strong economy is good for the entire state of Arizona and everyone who does business here.
Brewer Tax Veto Splits Private Sector (Phoenix Business Journal)
Zillow; Phoenix Home Prices Decline, 68 Percent Underwater (Phoenix Business Journal)
Petsmart Quarterly Income up 33% (The Arizona Republic)
The Rocky Mountain Poll; Consumer Confidence up in Arizona (W.P. Carey-Arizona State University)
Scottsdale Hotels Tourism Rebound (The Arizona Republic)
Retail Sales Holding Up (Arizona Daily Sun)