I’m certain this graph is of enormous importance in understanding long range water issues in the west. But I’m not entirely sure how.
It’s single family home starts in the Phoenix (blue) and Las Vegas (red) metro areas over the last decade:
What you see here is the housing bubble bursting. Adam Nagourney did a nice job in the New York Times last week of explaining what this means in Nevada, where demographers say population is actually declining – a remarkable fact for what on paper looked in the 2010 census like the fastest growing state in the country:
The state demographer, Jeff Hardcastle, estimated that Nevada had lost more than 90,000 people since July 2008, and expects the decline to continue through next year. He said that before 2007, Nevada had been the top-growing state for most of the past 20 years.
The Economist jumped in with stark employment figures:
Depopulation in Nevada would be particularly unpleasant given the housing overhang in the state that has already driven home prices in Las Vegas down by nealry 60%. Further population exits would increase supply relative to demand, generate more price drops and potentially more defaults. Of course, falling prices could ultimately lead to a new influx of residents attracted by cheap housing. But the adjustment process will be difficult, and the new Nevada economic model will look very different from the old one.
Phoenix also has seen a drop in its civilian work force, though not nearly as great in percentage terms as Las Vegas. But this all leaves me wondering about water. In the short term, it buys breathing room. But in the long term, what will the economic model look like, and what does that imply for future water demand?