News / USA

Obama Returns to Arizona to Tout US Housing Recovery

A home is seen for sale in Gilbert, Arizona, July 30, 2013.
A home is seen for sale in Gilbert, Arizona, July 30, 2013.
Reuters
With images of vacant, half-built residential developments that gathered dust after the recession, the U.S. Southwest once symbolized the 2008-2012 housing bust that wiped out $7 trillion in homeowner equity and wrecked the finances of many Americans.

But as housing stages a recovery around the United States, including the hard-hit Sun Belt, President Barack Obama goes back to the region on Tuesday to claim some of the credit while urging further action to keep the housing winning streak alive.

More than four years after Obama outlined his plan to halt the housing market free fall in February 2009, he returns to Phoenix, where he will again talk about housing. The speech is another stop in a summer tour in which he is highlighting aspects of the economy that have improved under his watch while chiding political foes for obstructing faster progress.

But in Phoenix, the bright housing picture of increased sales and firmer prices mask continued challenges for those seeking housing, particularly those at the bottom rungs of the economic ladder, say homeowner advocates.

“My fear is that people think the problem is over,” said Patricia Garcia Duarte, president of Neighborhood Housing Services of Phoenix. “There are still families that are struggling.”

Even those who have steady work and decent credit find themselves turned down by lenders requiring big down payments and pristine credit, she said.

Arizona, Nevada, California and Florida were the states hit hardest by cratering house prices, over building and the wave of foreclosures that started during the 2008 financial crisis. In Phoenix, Obama can point to gains in house prices and declines in foreclosures to argue that his policies established a floor for housing markets and set the stage for a rebound.

Garcia Duarte, whose organization is a chapter of a national nonprofit, said she still sees plenty of people, however, who are trying to do everything they can to stay in their homes.

What she sees in the trenches is that while foreclosures are down, more families are resorting to short sales - a sale for less than what is owed on the property - to minimize the damage. And because investors have bought homes instead of individuals, some communities have seen homeownership decline and renting rise, she said.

“I would like the president to highlight that homeownership should be a good investment,” she said. “I think policymakers shifted and crossed out homeownership as a good thing to do for this country.”

Rising from the ashes

Obama's return to Phoenix will have historic resonance because he spoke there the day after signing his $787-billion stimulus plan into law more than four years ago.

He is again focusing on the economy, trying this time to pressure lawmakers into passing government spending bills that reverse deep spending cuts and allocate funds to repair roads and bridges, and raise the nation's debt limit without drama before looming fall deadlines.

The president's focus on housing reflects the sector's outsize impact on the broader economy. Not only is a home usually a family's largest purchase, the effects of home buying ripple outward and affect a swath of other businesses such as appliance, furniture and hardware sales, landscaping and finance.

Obama is using his series of speeches to press for action to strengthen a tepid economic recovery. He is emphasizing jobs and middle class economic stability to counter a Republican message of concern over debt and deficits.

With his legislative initiatives on guns and immigration dead or stalled, Obama may also be motivated to build support for Democrats in 2014 mid-term elections. Democrats hold a slim majority in the Senate that may be at risk and are in the minority in the House of Representatives.

With housing, the president may feel he has some progress to boast about.

“It went from free fall to surging house prices; there's a big revival in housing construction,” said Mark Zandi, chief economist for Moody's Analytics. “The whole world has been turned around for a place like Phoenix.”

The median new home sale price rose almost 18 percent in greater Phoenix between May 2012 and May 2013, and the median “normal” existing home sale price rose more than 12 percent in that period, according to a recent Arizona State University report. Normal sales exclude the sale of distressed or bank-owned properties.

Analysts say housing appears to be on a solid footing not just in the Southwest, but nationally. Much of the early gains have been driven by investment funds, and economists say more individuals need to become involved to sustain the market. But that will require a stronger jobs market.

“Investors were instrumental in turning housing markets around, but we need to see the baton passed from the investor to the first-time home buyer,” said Zandi.

Homeownership in the United States hit a 17-1/2-year low in the second quarter as Americans continue to shift toward renting, one of the lingering legacies of the recession.

You May Like

Cambodia Seeks Official UN Maps for Vietnam Border

Notice of request comes as 2 countries open border talks Tuesday after a clash last month More

From South Africa to Vietnam, Cyclists Deliver Message Against Rhino Horns

Appalled by poaching they saw firsthand, sisters embark on tour to raise awareness in countries where rhino horn products are in demand More

Uber Wants Johannesburg Police Protection

Request follows recent protests outside ride-hailing service's Johannesburg office More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Getting it Done Beyond a Nuclear Deali
X
July 07, 2015 12:02 PM
If a nuclear deal is reached between Iran and world powers in Vienna, it will be a highly technical road map to be used to monitor nuclear activity in Iran for years to come to ensure Tehran does not make nuclear weapons. Equally as complicated will be dismantling international sanctions that were originally intended to be ironclad. VOA’s Heather Murdock talks to experts about the key challenges any deal will present.
Video

Video Getting it Done Beyond a Nuclear Deal

If a nuclear deal is reached between Iran and world powers in Vienna, it will be a highly technical road map to be used to monitor nuclear activity in Iran for years to come to ensure Tehran does not make nuclear weapons. Equally as complicated will be dismantling international sanctions that were originally intended to be ironclad. VOA’s Heather Murdock talks to experts about the key challenges any deal will present.
Video

Video Rice Farmers Frustrated As Drought Grips Thailand

A severe drought in Thailand is limiting the growing season of the country’s important rice crop. Farmers are blaming the government for not doing more to protect a key export. Steve Sandford reports from Chiang Mai, Thailand.
Video

Video Making Music, Fleeing Bombs: New Film on Sudan’s Internal Refugees

In 2012, Sudanese filmmaker Hajooj Kuka went to make a documentary among civil war refugees in Sudan’s Blue Nile and Nuba Mountains region. What he found surprised him: music was helping to save people from bombing raids by their own government. VOA’s Carolyn Weaver has more.
Video

Video 'From This Day Forward' Reveals Difficult Journey of Transgender Parent

In her documentary, "From This Day Forward", filmmaker Sharon Shattuck reveals the personal journey of her transgender father, as he told his family that he always felt he was a woman inside and decided to live as one. VOA’s Penelope Poulou has more.
Video

Video Floodwaters Threaten Iconic American Home

The Farnsworth House in the Midwest State of Illinois is one of the most iconic homes in America. Thousands of tourists visit the site every year. Its location near a river inspired the design of the house, but, as VOA’s Kane Farabaugh reports, that very location is now threatening the existence of this National Historic Landmark.
Video

Video Olympics Construction Scars Sacred Korean Mountain

Environmentalists in South Korea are protesting a Winter Olympics construction project to build a ski slope through a 500-year-old protected forest. Brian Padden reports that although there is strong national support for hosting the 2018 Pyeongchang Winter Olympics, there are growing public concerns over the costs and possible ecological damage at the revered mountain.
Video

Video Xenophobia Victims in South Africa Flee Violence, Then Return

Many Malawians fled South Africa early this year after xenophobic attacks on African immigrants. But many quickly found life was no better at home and have returned to South Africa – often illegally and without jobs, and facing the tough task of having to start over. Lameck Masina and Anita Powell file from Johannesburg.
Video

Video Family of American Marine Calls for Release From Iranian Prison

As the crowd of journalists covering the Iran talks swells, so too do the opportunities for media coverage.  Hoping to catch the attention of high-level diplomats, the family of American-Iranian marine Amir Hekmati is in Vienna, pleading for his release from an Iranian prison after nearly 4 years.  VOA’s Heather Murdock reports from Vienna.
Video

Video UK Holds Terror Drill as MPs Mull Tunisia Response

After pledging a tough response to last Friday’s terror attack in Tunisia, which came just days before the 10th anniversary of the bomb attacks on London’s transport network, British security services are shifting their focus to overseas counter-terror operations. VOA's Henry Ridgwell has more.
Video

Video Obama on Cuba: This is What Change Looks Like

President Barack Obama says the United States will soon reopen its embassy in Cuba for the first time since 1961, ending a half-century of isolation. VOA White House correspondent Luis Ramirez reports.
Video

Video Hate Groups Spread Influence Via Internet

Hate groups of various kinds are using the Internet for propaganda and recruitment, and a Jewish human rights organization that monitors these groups, the Simon Wiesenthal Center, says their influence is growing. The messages are different, but the calls to hatred or violence are similar. VOA's Mike O’Sullivan reports.
Video

Video Blind Somali Journalist Defies Odds in Mogadishu

Despite improving security in the last few years, Somalia remains one of the most dangerous countries to be a journalist – even more so for someone who cannot see. Abdulaziz Billow has the story of journalist Abdifatah Hassan Kalgacal, who has been reporting from the Somali capital for the last decade despite being blind.

VOA Blogs