When President Obama took office in January 2009, he came into a housing market that saw housing prices declining at a rapid rate. No market, including Birmingham real estate, was exempt from the decline. Foreclosures were at an all time high and many homebuyers, homeowners and homebuilders were left wondering “where do we go from here?” As we approach the next election, many voters are looking at the housing market and evaluating the steps that Obama has taken over the past four years.
Obama’s administration has contributed to the recovery of the housing market by focusing on strengthening the economy. The 2009 stimulus prevented a worse recession which ultimately boosted housing demand, but the plan failed to meet the goals outlined by Obama himself. He said that the government would help as many as three to four million homeowners, but out of the 4.3 million people that had applied for assistance, only a little more than one million had received government-sponsored modifications as of May 2012 according to reports. In June 2011, Obama admitted that his administration had not done enough and promised to go back to the drawing board. In his 2012 State of the Union address in January, Obama proposed a new housing plan that aimed to make it easier for homeowners to refinance their mortgages by streamlining the financing process and allowing people with underwater mortgages to obtain new mortgages. This proposal could allow homeowners to reduce monthly mortgage payments by refinancing their current loans into new ones guaranteed by the Federal Housing Administration.
Recently, acting director of the Federal Housing Finance Agency, Edward DeMarco, turned down a proposal from Obama’s administration asking the agency, which oversees Fannie Mae and Freddie Mac, to accept a program that would allow mortgage companies to offer debt forgiveness to borrowers. Obama and his supporters feel that the proposal would help reduce foreclosures, but DeMarco argues in a statement that it “would not make a meaningful improvement in reducing foreclosures.”
While foreclosures and underwater buyers continue to be the Achilles heel of the housing market for Obama and his 2012 campaign, the housing market has seen improvements over the last four years. Home prices have stabilized and so far in 2012 they have risen, mortgage rates have fallen, the number of inventory homes has fallen by 36% since January 2009, and fewer people are falling behind on their payments. Obama has yet to really put any focus on the housing market in his reelection campaign, so Americans will have to wait to see what next step he will take.
When the housing bubble busted five years ago, millions of Americans were left struggling to survive. President Obama has not been aggressive with the housing market recovery, focusing instead on the economy. While the housing market is improving, Obama has only begun to make a dent in solving the problem.
Recent reports have shown that the Birmingham housing market is recovering. At Harris Doyle we offer Birmingham new homes that feature spacious home designs and state-of-the-art finishes. For more information on our communities, visit www.harrisdoyle.com.