Phoenix cost of living remains low!

Phoenix cost of living remains low
The Business Journal of Phoenix - March 10, 2006
by Chris Casacchia
The Business Journal
Despite skyrocketing housing prices, greater Phoenix is one the most inexpensive major metropolitan areas in the U.S. to live, work and operate a business.
Phoenix ranked 8 among 29 major metropolitan areas according to the latest statistics released Friday by the American Chamber of Commerce Research Association, the Council for Community and Economic Research and the Greater Phoenix Chamber of Commerce.
Greater Phoenix's 2005 fourth-quarter index of 100.4 was slightly above the national average of 100, and lower than other metropolitan areas such as Las Vegas, San Diego, Seattle, Los Angeles and Chicago.
The composite index is based on six components -- housing, utilities, grocery items, transportation, health care and miscellaneous goods and services.
Overall, the report shows the standard of living ranged from more than twice the national average in Manhattan to more than 20 percent below the nationwide mean in McAlester, Okla.
With a composite index of 88.9, Houston ranked as the most affordable large metropolitan area.
Even with the Valley's recent spike in home sales, which appreciated more than 35 percent in 2005, the housing market remains only slightly above the nation's average with an index of 101.8. In comparison, Las Vegas had a housing index of 134.8.
"Up until last year, the supply and demand of housing was such that housing was always very reasonable," said economist Elliott Pollack, of Elliott D. Pollack & Co.
Greater Phoenix's affordability makes it an appealing target for relocating businesses as job growth, he said.
"Because it's easy to attract employees, it's easy to attract employers," Pollack said.
The Valley has attracted some large employers within the last six months, including Google Inc., which will create 600 IT and engineering jobs, and AAA, which will locate between 900 to 1,100 new jobs in a new information technology and customer service center in Glendale. Intel Corp. also announced a $3 billion expansion in Chandler.
According to Global Insight Inc., Phoenix's employment base grew 4.1 percent in 2005, while its economy expanded 8.6 percent.
Most of this growth can be attributed to the scorching real estate market of 2005.
The Massachusetts economic forecasting company named Phoenix, Las Vegas and Orlando, Fla. as its leading cities for job growth in 2006.
Katie Pushor, president and chief executive of the Greater Phoenix Chamber of Commerce, said the index reflects why the Valley is a great place to start, relocate and grow a business.
"Employers are better able to afford to add new workers in our market compared to other metro areas, where employees demand higher salaries due to the cost of living," Pushor added.