You might recall that I wrote about anti-deficiency a couple months ago.

It is a dry topic, but incredibly important to the market in Arizona. Had the law stuck, we would have seen a huge disruption in the sale of homes through the end of the year. Well, here’s the latest.

The House of Representatives passed SB 1004, the anti-deficiency fix, on November 23rd in a special session with a vote of 53-0. SB 1004 included the repeal and replacement of ARS§ 33-814 essentially returning the statute to its original status prior to the passage of SB 1271. With this fix, Arizona will continue to operate as a deed of trust state with the protections that have been in existence since 1971.

SB 1004 did pass both the Arizona State Senate and House of Representatives with an emergency clause, and it will go into effect upon Governor Brewer’s signature.

The Arizona Association of Realtors promises to continue to work on language to address “speculative builders” in the upcoming session in order to resolve this issue entirely.

Of course, it begs the question of where they were when all of this originally happened!

I graduated high school in June, 1989 from a small NATO high school in Holland.

The 400 some-odd students in that school were present at the epicenter of a changing world. Ronald Reagan had recently put MX missiles in western Europe to counter the Soviet SS-20s, to great protest by many and the glee of others.

Mikhail Gorbachev (you know, the guy who actually ended the cold war), had been loosening up the Soviet Empire to change since 1985.

The Irish Republican Army and the Red Army Faction were still actively setting off bombs around England and the Continent –one of which killed British military personnel about three miles from my house, literally shaking us awake in the middle of the night.

I think most of us in that school knew that we were in an incredible time and noteworthy place, but we just took it for granted.

I returned home a month later and enrolled at NAU. Like almost every other student, I did my orientation and nervously began the grind.  I lived in a dorm called Tinsley Hall and tried to learn how adapt to this vastly different lifestyle.

This time sticks in my memory, not so much because of the new school and bad cafeteria food, but because of November 9th, 1989. Just five months after I left Germany the Berlin Wall was coming down.

I remember coming back to the dorm, to my room mate from small town Arizona telling me that he “thought there was something happening in Germany on the news that looked important, and you should see.” He was not quite sure what it was.

So, there on my little TV was everything: people dancing on the wall that I had seen only a couple years before. They took sledge hammers to this here-to-fore insurmountable monolith. They poured champagne on each other in elation.

I remember running up and down the halls of the dorm, sticking my head in every door and yelling “The Berlin Wall is coming down! Turn on the news.”

Unfortunately nobody did. They did not get it.

It took me a while to get over the fact that this was not of incredible importance to most students. I couldn’t see how they wouldn’t find this of central importance. At the same time it was an incredible historic event that I wanted desperately to go and see first hand. It was a lesson in perspective.  People find important that which is most immediate.

It also drove home for me just how lucky I was to have been where I was the four years previous and that I should never take that kind of opportunity for granted again.

I’m sitting here typing and looking at this piece of the Berlin wall in a frame in my office. In the frame, mounted under the little asbestos-filled piece of oppression, is a picture of my brother and I as teenagers, jokingly pretending to climb the wall, circa 1987.

No much to say, but Happy 20th Anniversary of the fall of the wall.

A new central utility plant for Phoenix Children’s Hospital uses new technology and other innovations that will save 5.6 million gallons of water per year for the water-scarce Phoenix area (enough for 120 households) and will guarantee $570,000 in energy savings per year over 15 years, versus a traditional design.

They are using a chiller, which is the most efficient way to cool using existing technology. Basically, you make ice all night long and then blow air over it during the day for A/C. They basically do the opposite in the winter to make hot air and hot water.

Chase Field and surrounding buildings all share one massive chiller to heat and cool, as does the entire campus of UofA. I think ASU does, but my memory is failing there.

The only way they could use less energy to generate hot and cold water is to use solar hot water to help off-set the natural gas used to run the compressors. But, that technology is still being rolled out. Not in time for the new hospital tower.

Still, its pretty cool. I hope all new buildings take this same tactic.

Learn more at the developer’s website.

Check out this news, below, tracking the enrollment downtown.

After only four years, ASU downtown is up to 11,503 students. They are expecting upwards of 20,000 by 2012.

I am thrilled. Downtown students tend to be serious students and graduate students. These folks, along with faculty and staff, are going to make up the neighborhoods around downtown.

For those of us in Garfield, I think this is great. I think it means that we are going to have a vibrant community of people who are engaged as home owners or land lords. I think it will result if homes being renovated and people being active in the neighborhood.

It is a great time to invest in Garfield as the next campus community.

I’d love to hear your thoughts on it all.

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There were an astounding 8,000 closings in October 2009. That’s 50% above last year.

Didn’t I predict this buying spree six months ago? (Say “yes.”)

Expect even more closings in November, as everybody races for the tax credit.

Notice also that there is a greater trend toward short sales over foreclosures.  The percent of foreclosures continues to drop both as Closed transactions (44%) and in the Pending category (35%). 25% of the active listings were short sales. 31% of the pending sales were short sales.

Unlike a few months ago when short sales were active, but did not close, we are averaging 20% closed. Further, short sales are staying on the market for less time. So, the banks are doing better at processing them.

The price numbers are continuing to ‘bump around’ with no consistent trend line. October’s Average Sales price was down about $4000 to $171,000 and the Median Sales price was down $2000 to $128,000. Both of these numbers are considerably above the yearly lows of $159,000 and $115,000 respectively, but the Average has been up and down for the past 4 months, with the Median down for the first time since April.

What does all of this mean?

It means that everybody is rushing so hard for the tax credit that they are buying whatever they can.

What does it mean if you want to buy?

It means that you should try to buy during the holidays when everybody else has either already captured the tax credit, or has given up. The holidays usually see less activity, so that might increase your power as a buyer.

Please give me a holler if I can help you with more market analysis.

Data compiled from report by my broker, Jim Sexton of John Hall and Associates.

You might have seen my previous post on this topic of the potential of the $8,000 tax credit.

The National Association of Realtors wants Congress to extend and expand the $8,000 tax credit. Now it will not only be for first time home buyers, but everybody.

As an agent, I would continue to do everything I can to get my clients this credit if it remains in effect.

However, I believe that the cost to the country (over $200 billion) is not necessary. Further, I believe that this could encourage more unrealistic upward pressure on home prices –something that got us in to this mess.

I think the expectation is that the housing market will drive the economy. That is questionable when the commercial real estate market is tanking.  I believe that there will be an imbalance as people obligate themselves to new homes while unemployment might continue to rise and the commercial real estate market might result in more lay-offs.

The result could be many more people buying houses that they cannot afford.

This recovery needs to be driven, not by real estate, but by investment in infrastructure, energy and technology.

For your information, here is the National Association of Realtors Call to Action. I have called and told the Senators and Rep. Mitchell that I do not want to see the extension.

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Dear Arizona REALTOR:

The U.S. Senate will be voting on an amendment this week that would extend the first-time homebuyer tax credit.

NAR is supporting the Dodd-Lieberman-Isakson amendment because this amendment will:

–Provide the $8,000 tax credit to any buyer (not just first time)
–Set income limits at $150,000/$300,000 for single/married buyers
–Make the credit available until June 30, 2010

NAR’s Legislative talking points on the Dodd-Lieberman-Isakson Amendment $8,000 Homebuyer Tax Credit also are attached for your use.

NAR is asking for your help in generating phone calls from Arizona REALTORS to the offices of Senator McCain and Senator Kyl in Washington, DC.

Please request to speak to each Senator’s Tax Legislative Assistant and ask them to support the Dodd-Lieberman-Isakson amendment. We need to generate as many calls as quickly as possible.  Below are the phone numbers for our Senators.

Senator McCain:   202-224-2235
Senator Kyl:       202-224-4521

Thank you for your prompt response on this important issue!

My friend and architect Tazmine Loomans has a blog where she highlights restaurants that feature sustainable food choices.

Locally-grown, organic even proximity to public transport.

She has a whole new list of restaurants and coffee bars. Some are in Phoenix and some are not. Regardless, it is a pretty good guide and a good place to check in for ideas.

Which makes me think, perhaps we need a U.S. Green Building Council certification for restaurants.

That is a totally geeky idea and very “insider” if you don’t know that the USGBC certifies new and existing buildings as “green” if they do a number of things, including installing better insulation, solar panels and features that support people who use mass transit. They even give credits for reusing waste created when you build the building or tear down an existing structure.

How would your favorite restaurant fare if measured up against a U.S. Green Eating Council?

You may know that the US Green Building Council will be here in town in November for a huge conference featuring Cheryl Crow, Al Gore, Smokey Robinson and, oh yeah…building sustainably.

You may also know that it is more expensive to build green. So, how can we build inexpensive sustainable structures for low-income home buyers? How can we renovate existing structures so we use less energy there?

The local USGBC will be hosting an event on just that topic. See the announcement, below. I plan to be there.

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USGBC

Affordable Housing Summit

Phoenix, AZ

November 10-11, 2009

Join us on Tuesday, November 10, for a full day of panel discussions with national experts on green affordable housing, focusing on the rehabilitation of existing homes and transit oriented development, as well as small group charrettes on real projects around the country.  The second day of the Summit will include a guided tour of innovative projects in and around Phoenix, AZ.

This is a free pre-conference event organized In conjunction with the

2009 Greenbuild International Conference and Expo.

Contact Tom Flanagan at tflanagan@usgbc.org to receive an invitation.

The Arizona Republic ran an editorial (I think) on October 11th with a list of problems in policy-making and possible solutions.

They suggest that the best way to reduce extremism in AZ politics is to (1) get rid of Clean Elections and (2) make competitive districts.

It is nice to see that my three-year long mantra is starting to stick with some folks. However, the idea that eliminating Clean Elections will do anything to improve politics in AZ is ignorant of our own history.

Clearly nobody at the editorial board (or among our legislators who talk about “reforming” Clean Elections while they try to gut it) remember what it was like before Clean Elections.

The only people who could run a campaign were those who could get gobs of money from the Arizona and Phoenix Chambers of Commerce, lobbyist or the home builders. This meant that candidates were, in many ways, hand-picked before they even got started.

That is why the chambers and the home builders would like to see us go back to the old, broken ways.

There are problems with Clean Elections, but not enough to justify tearing it all down!

If you have competitive districts –i.e. within 6% registration, Dem/Rep, it will be more difficult for the extremes of both party to get candidates in to office, regardless of whether they run clean or not.

So, why tear down a system that allows more people to get involved?

Like Columbo, we need to just keep coming back to the suspects behind this effort to ask the same questions over and over. Motive? Opportunity? Means?

I’ve read this article by CNN commentator John Avlon several times because I think it is perfectly on the mark about what ails our republic.

(If you are a regular reader of the Clark Report, you know that I believe that competitive redistricting is our only possible solution to an ever-polarizing political landscape. I won’t beat that dead horse here, except to say it stands to reason that we will have politicians who cater less to the lunatic fringe and their own narrow interests when they must win in a truly competitive district.)

Of course, one critique of articles like that above is that there never really ever was civility in politics. As I recall, opponents of Andrew Jackson claimed that he was an adulterer, etc.

However, I think the Avlon article reminds us that the problem is not lack of civility from some quarters, rather the amount of space we give those lacking civility at the table of democratic discourse. After all, now the distance between lie and the public eye is even shorter than when Churchill famously said that “A lie gets halfway around the world before the truth has a chance to get its pants on.”

There is something different: the blog-as-news syndrome. We have lost the old standard-bearer news organizations and returned to the days of Jackson when papers were owned by partisan organizations or industrialists. We are Balkanizing and we don’t seem to care.

I saw the most frightening aspect of that first hand in Bosnia. In support of their political masters, “news” organizations just parroted the party line to the point of tearing that country apart, resulting in over 200,000 deaths.

In American history, we avoided that fate over 100 years ago as the Journalists Canon of Ethics took on greater meaning and newspapers became more professional and independent.

Walter Kronkite is not just a good anchor, he epitomized the way journalists aught to be.  But more that that, he epitomized the way editors should be. The best news  production was professional, process-driven and introspective enough to admit when it made mistakes.

This is where I think the turning point needs to be. Blogs don’t have editors and fact checkers –and that is bad enough because people take blogs as true news sources. To make it worse, editors at Fox and MSNBC, primarily, have decided to continually blur the line between news and commentary.

Really, you can’t always tell which show is meant to be a commentary show and which is news.

Editors: you need to take back control of the process. Your news readers should be only that, news readers. They are not stars. They should not toss in comments or throw knowing glances at the camera to tell you how they feel about the news. In fact, tear it all down and start over. But this time, re-read the Canons of Journalism.

Only then can we strive to have civility in discourse. Only then can we really protect our democracy.