By Michael Del Prete | AZREIA
As valued members of the Arizona Real Estate Investors Association (AZREIA), it is our commitment to keep you informed on issues affecting our industry. Today, our beautiful, sun-soaked Arizona is at a crossroads of a critical issue – water.
Governor Katie Hobbs’ recent decision to pause new assured water supply certificates in developments that rely on groundwater has sparked conversation across Arizona. While this doesn’t signal a complete halt to development—major cities like Phoenix remain unaffected—it does have implications for investors focusing on smaller, rapidly expanding towns.
What does this mean for us as real estate investors? Primarily, it calls for a reassessment of strategies, particularly for developments in smaller towns. It’s a clear indicator that water security and real estate growth are interconnected, and we must factor this into our planning.
But it’s not all clouds on the horizon. Arizona has invested significantly in water security, with over $360 million funneled into water infrastructure and an additional $1.2 billion from federal funds for water conservation. This commitment is likely to sustain a reliable water supply for the next one hundred years, fostering stability for our investments.
Here’s where it gets intriguing: this situation opens doors to new possibilities. A few ideas have stood out. Investing in properties with water-efficient appliances and systems or those with innovative water solutions like onsite water recycling could become attractive opportunities. Likewise, properties in areas with a secure water supply may offer promising returns as demand in these regions may increase.
In addition, sustainable practices like water-efficient farming, wastewater treatment, and water trading are gaining prominence. These could influence real estate trends, with properties implementing such practices potentially commanding a premium due to their enhanced water security.
Here at AZREIA, we understand the importance of these developments and are dedicated to keeping you updated. We are closely monitoring the situation, analyzing its impact, and strategizing for the future. We believe that as we align our investments with water security, we not only ensure profitable returns but also contribute to the long-term sustainability of our state.
Stay tuned for further updates, and, as always, feel free to reach out if you have any questions or need assistance with anything.
Mike Del Prete
AZREIA Executive Director