It’s a worst-case scenario for homeowners in a suburb of Scottsdale, Arizona. Due to drought conditions in the Southwest, the water supply for Rio Verde Foothills has been shut off. Residents have been left scrambling for water. They have filed a lawsuit, but the bigger question is whether the building boom can continue in Arizona. Land has been inexpensive in Arizona but without enough water, is land really that cheap?   Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.   Scottsdale supplied Rio Verde Foothills with water for decades, since it sprouted into existence in the 1970’s. It’s an unincorporated part of Maricopa county with about 600 homes and about 1,000 residents. The water was trucked in, but with a decades-long drought and a shrinking supply of water from the Colorado River, Scottsdale says it needs to conserve water for its own residents and can no longer deliver water to Rio Verde.    It’s not just a wake-up call for the residents of Rio Verde, but for residents across Arizona and the western part of the U.S. where drought conditions are ongoing. In a Time article on the water crisis, the author poses the question: “In an era where climate change is shrinking the water supply, should the desert state (of Arizona) keep building homes that depend on water from elsewhere?”   It’s a question with significant repercussions at a time when the state is enthusiastically welcoming new residents and encouraging growth. Arizona’s population has skyrocketed over the last 50 years and is currently at about 7.35 million residents. Census Bureau data shows that Arizona’s population surged 1.3% from July 2021 to July of last year. That represents more than 94,000 people coming into the state and puts Arizona in fifth place for U.S. population growth. The only states with more growth were Georgia, North Carolina, Florida and Texas. (2)   Census Data also shows that Maricopa county, where Phoenix, Scottsdale and Rio Verde are all located, is the eighth fastest growing county in the country. Time also reports that it isn’t just more and more people but water thirsty companies, like data centers, which are expanding into the area and impacting the precious water supply.    Some say that the water supply can no longer support the growth boom, and that’s a concept that developers and builders are wrestling with. Arizona’s governor, Katie Hobbs released a report that shows a huge water deficit in an area west of Phoenix in the White Tank Mountains where developers want to build. According to Time, these are homes that would house about 800,000 people. But Arizona is now reporting to the local media that developers will have to find their own water supplies or some other solution, before they can build.   Since the state’s supply of water from the Colorado River is already spoken for, they won’t be getting it from there. If they can’t get enough from the ground, they may have to truck it in, which didn’t work very well for the residents in Rio Verde. Other ideas have included a pipeline from some distant water saturated area, or from a desalination plant that’s yet to be built in Mexico’s Sea of Cortez.   With drought and climate change issues intensifying, these kinds of ideas are coming to the forefront. Developers see the water pipeline idea as a way to create a stable source of water that will sustain growth for years to come. And maybe that’s what the Southwest real estate industry needs. But Time reports there’s also the unmentionable idea that growth cannot continue as it has been, and the pipeline/desalinization idea is  the only inevitable solution. It comes with several drawbacks however.   First, the process involves wastewater that would probably be dumped back into the Sea of Cortez and potentially harm sea life. The pipeline would also cut through Organ Pipe National Monument in Arizona, and across land in Mexican territory, which might not s