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News Article From: 09-11-2007The first article, Cost to rent in the Valley on the slowdown, from the East Valley Tribune, reports that after two years of escalating apartment rents, relief is in sight for Valley renters, as rentals of single-family homes and failed condo conversions flood the market. From the second quarter 2002 to the same period in 2004, rents edged up 0.15 percent, said Pete TeKampe, a broker with Marcus & Millichap. During the same period from 2005 though 2007, rents jumped 10.8 percent. This year, growth is expected to slow to 2.5 to 3 percent, he said. The reason is that more supply is coming to the market, primarily because of the single-family homes flooding the market and because of the more than 30,000 apartment units converted to condos, at least 7,000 are expected to come back on the market as rentals. The Valley's apartment vacancy rate was 10.9 percent in the second quarter, up from 7.5 percent for the same period last year. A healthy vacancy rate is typically from 5 to 7 percent, TeKampe said.About 60 percent of landlords are now offering incentives, up from 46 percent in the second quarter.
The second article, Recession could hit strained economy, from the Arizona Republic, reports that the U.S. economy, strained by an ailing housing market and credit woes, could log its worst performance in five years, forecasters said Monday. The number 1 risk though, is that the economy will lose its footing altogether and fall into a recession. A forecast released Monday by the National Association of Business Economics puts the growth of gross domestic product at an anemic 2 percent for this year, the weakest since 2002. More than 60 percent of those responding cited recession "as the major risk facing the economy over the next year, while only a third cited inflation as the greatest problem," the group said. Those most concerned about the recession threat tended to cite problems in the sub-prime mortgage market and potential declines in home values as forces most likely to end the current six-year expansion, the group said. To help the economy, the forecasters predict that the Federal reserve will lower its key interest rate, now at 5.52 percent, to 4.75 percent.
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