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

UN Ambassador Power Highlights Plight of Women Prisoners

She launches the 'Free the 20' campaign, aimed at profiling women being deprived of their freedom around the world More

Satellite Launch Sparks Spectacular Light Show

A slight delay in a satellite launch lit up the Florida sky early this morning More

Fleeing IS Killings in Syria, Family Reaches Bavaria

Exhausted, scared and under-nourished, Khalil and Maha's tale mirrors those of thousands of refugees from war-torn countries who have left their homes in the hopes of finding a better life 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.
Nobel Prize Winner Malala Talks to VOAi
X
August 31, 2015 2:17 AM
Nobel Peace Prize winner Malala Yousafzai met with VOA's Deewa service in Washington Sunday to talk about women’s rights and unveil a trailer for her new documentary. VOA's Katherine Gypson has more.
Video

Video Nobel Prize Winner Malala Talks to VOA

Nobel Peace Prize winner Malala Yousafzai met with VOA's Deewa service in Washington Sunday to talk about women’s rights and unveil a trailer for her new documentary. VOA's Katherine Gypson has more.
Video

Video War, Drought Threaten Iraq's Marshlands

Iraq's southern wetlands are in crisis. These areas are the spawning ground for Gulf fisheries, a resting place for migrating wildfowl, and source of livelihood for fishermen and herders. Faith Lapidus has more.
Video

Video Colombians Flee Venezuela as Border Crisis Escalates

Hundreds of Colombians have fled Venezuela since last week, amid an escalating border crisis between the two countries. Last week, Venezuelan President Nicolas Maduro ordered the closure of a key border crossing after smugglers injured three Venezuelan soldiers and a civilian. The president also ordered the deportation of Colombians who are in Venezuela illegally. Zlatica Hoke reports.
Video

Video Rebuilding New Orleans' Music Scene

Ten years after Hurricane Katrina inundated New Orleans, threatening to wash away its vibrant musical heritage along with its neighborhoods, the beat goes on. As Bronwyn Benito and Faith Lapidus report, a Musicians' Village is preserving the city's unique sound.
Video

Video In Russia, Auto Industry in Tailspin

Industry insiders say country relies too heavily on imports as inflation cuts too many consumers out of the market. Daniel Schearf has more from Moscow.
Video

Video Scientist Calls Use of Fetal Tissue in Medical Research Essential

An anti-abortion group responsible for secret recordings of workers at a women's health care organization claims the workers shown are offering baby parts for sale, a charge the organization strongly denies. While the selling of fetal tissue is against the law in the United States, abortion and the use of donated fetal tissue for medical research are both legal. VOA’s Julie Taboh reports.
Video

Video Next to Iran, Climate at Forefront of Obama Agenda

President Barack Obama this week announced new initiatives aimed at making it easier for Americans to access renewable energy sources such as solar and wind. Obama is not slowing down when it comes to pushing through climate change measures, an issue he says is the greatest threat to the country’s national security. VOA correspondent Aru Pande has more from the White House.
Video

Video Arctic Draws International Competition for Oil

A new geopolitical “Great Game” is underway in earth’s northernmost region, the Arctic, where Russia has claimed a large area for resource development and President Barack Obama recently approved Shell Oil Company’s test-drilling project in an area under U.S. control. Greg Flakus reports.
Video

Video Philippine Maritime Police: Chinese Fishermen a Threat to Country’s Security

China and the Philippines both claim maritime rights in the South China Sea.  That includes the right to fish in those waters. Jason Strother reports on how the Philippines is catching Chinese nationals it says are illegal poachers. He has the story from Palawan province.
Video

Video China's Spratly Island Building Said to Light Up the Night 'Like A City'

Southeast Asian countries claim China has illegally seized territory in the Spratly islands. It is especially a concern for a Philippine mayor who says Beijing is occupying parts of his municipality. Jason Strother reports from the capital of Palawan province, Puerto Princesa.
Video

Video Ages-old Ice Reveals Secrets of Climate Change

Ice caps don't just exist at the world's poles. There are also tropical ice caps, and the largest sits atop the Peruvian Andes - but it is melting, quickly, and may be gone within the next 20 years. George Putic reports scientists are now rushing to take samples to get at the valuable information about climate change locked in the ice.

VOA Blogs