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Housing takes back seat in Obama's State of the Union
Unlike in past years, when housing policy and the mortgage market were key issues in State of the Union addresses, the 2013 edition only mentioned them in passing and lacked any new proposals.
This year, President Barack Obama repeated his call to loosen mortgage lending standards, which many industry advocates say became too strict in the backlash against the easy credit that fueled the housing bubble and doomed it to collapse.
Many, including Obama, say the inability to access today’s historically low mortgage rates is keeping potential buyers out of the housing market and keeping underwater Americans from easing their debt burdens. “That’s holding our entire economy back, and we need to fix it,” Obama said Tuesday night.
He addressed at least part of the issue last year, when he promised “no more red tape” and proposed a plan that would widen access to mortgage refinances. At the time, he estimated that the policy would save the average American $3,000 per year. But as the president noted in his address, that bill is still being kicked around Congress. “What are we waiting for?” he asked. “Take a vote, and send me that bill.”
Combine lawmakers’ inability to make any substantial progress on his past proposal with the near universal improvement in housing data and Obama had little incentive to make it a focus of his speech Tuesday night.
Consider the housing data that has emerged in just the last few weeks. The Case-Shiller Index reported a sixth consecutive month of year-over-year home price increases, the U.S. Department of Commerce found a 19.9 percent annual increase in sales of newly built single-family homes in 2012 and the National Association of Realtors said existing-home sales jumped 9.2 percent in 2012 compared to the prior year. As reported in Wednesday’s Newsday, even the Long Island market is showing clear improvement.
Therefore, it's little surprise that employment, clean energy and infrastructural improvements are taking clear precedence over housing initiatives as Obama sets his second-term agenda.