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

VOA Exclusive: Interview With Myanmar President Thein Sein

Thein Sein calls allegations that minority Muslim Rohingya are fleeing alleged torture in Rakhine state a media fabrication More

Video Better Protective Suit Sought for Ebola Caregivers

Current suit is uncomfortable, requires too many steps for removal, increasing chance of deadly contact with virus More

UN Rights Commission Investigates Eritrea

Three-member commission will start collecting first-hand information from victims and other witnesses in Switzerland and Italy next week 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.
Ebola Economic Toll Stirs W. Africa Food Security Concernsi
X
November 19, 2014 11:39 PM
The World Bank said Wednesday that it expects the economic impact of the Ebola outbreak on the sub-Saharan economy to cost somewhere betweenf $3 billion to $4 billion - well below a previously-outlined worst-case scenario of $32 billion. Some economists, however, paint a gloomier picture - warning that the disruption to regional markets and trading is considerable. Henry Ridgwell reports from London.
Video

Video Ebola Economic Toll Stirs W. Africa Food Security Concerns

The World Bank said Wednesday that it expects the economic impact of the Ebola outbreak on the sub-Saharan economy to cost somewhere betweenf $3 billion to $4 billion - well below a previously-outlined worst-case scenario of $32 billion. Some economists, however, paint a gloomier picture - warning that the disruption to regional markets and trading is considerable. Henry Ridgwell reports from London.
Video

Video Mexico Protests Escalate Over Disappearances

Protests in Mexico over 43 students missing since September continue to escalate, reflecting growing anger among Mexicans about a political system they view as corrupt, and increasingly tainted by the drug trade. Mounting outrage over the disappearances is now focused on the government of President Enrique Pena Nieto, accused of not doing enough to end insecurity in the country. More from VOA's Victoria Macchi.
Video

Video US Senate Votes Down Controversial Oil Pipeline - For Now

The U.S. Senate has rejected construction of a controversial pipeline to transport Canadian oil to American refineries. The $5 billion project still could be approved next year, but it faces a possible veto by President Barack Obama. As VOA’s Michael Bowman reports, the pipeline has exposed deep divisions in Congress about America’s energy future.
Video

Video Can Minsk Cease-fire Agreement Hold?

Growing tensions between government troops and separatists in eastern Ukraine further threaten a cease-fire agreement reached two months ago in the Belarusian capital of Minsk. Critics of U.S. policy in Ukraine say it is time the Obama administration gives up on that much-violated cease-fire and moves toward a new deal with Russia. VOA's Scott Stearns has more.
Video

Video Chaos, Abuse Defy Solution in Libya

The political and security crisis in Libya is deepening, with competing governments and, according to Amnesty International, widespread human rights violations committed with impunity. VOA’s Al Pessin reports from London.
Video

Video US Hosts Record 866,000 Foreign Students

Close to 900,000 international students are studying at American universities and colleges, more than ever before. About half of them come from Asia, mostly China. The United States hosts more foreign students than any other country in the world, and its foreign student population is steadily growing. Zlatica Hoke reports.
Video

Video Ferguson Church Grapples with Race Relations

Many white residents of Ferguson, Missouri, say they chose to live there because of the American Midwest community's diversity. So, they were shocked when a white police officer killed an unarmed black teenager in August – and shaken by the resulting protests and violence. Some local churches are leading conversations on how to go forward. VOA’s Ayesha Tanzeem reports.
Video

Video What Jon Stewart Learned About Iran From 'Rosewater'

Jon Stewart, host of the satirical news program "The Daily Show" talks with Saman Arbabi of Voice of America's Persian service about Stewart's directorial debut, "Rosewater."
Video

Video Lebanese Winemakers Thrive Despite War Next Door

In some of the most volatile parts of Lebanon, where a constant flow of refugees crosses the border from Syria, one industry continues to flourish against the odds. Lebanese winemakers say after surviving a brutal civil war in the 1970s and 80s, they can survive anything. Heather Murdock has more for VOA from the Bekaa Valley in Lebanon.
Video

Video China's Rise Closely Watched

China’s role as APEC host this week allowed a rare opportunity for Beijing to showcase its vision for the global economy and the region. But as China’s stature grows, so have tensions with other countries, including the United States. VOA’s Bill Ide in Beijing reports on how China’s rise as a global power is seen among Chinese and Americans.

All About America

AppleAndroid