In last night’s State of the Union address, President Obama paid specific attention to the housing crisis and its economic cost to the country. He called for “smart regulations” to ensure responsible behavior by all participants in housing and mortgage markets. And he called for a mass refinancing plan, which could help many existing homeowners if implemented correctly. We eagerly await details and hope for thoughtful, nonpartisan attention to housing.
The speech underscores the critical need for federal action to support housing, and through housing, a broader economic recovery. As the Fed’s recent paper and statements made clear, weakness in housing markets is preventing job creation, new investment, and economic growth. Meanwhile, millions in America, from working families to the poorest of the poor, cannot find affordable housing. Disruptions created by foreclosures and neighborhood disruption are making the problem worse, not better. And, as the Center for Housing Policy’s research shows, declining home prices have not solved America's housing affordability problems as the number of working families paying more than half their income for housing continues to grow.
NHC applauds the renewed attention to mortgage relief and effective regulation, but we know that more is needed. Housing isn’t an issue for one party or one region of the country—it’s a challenge that all in America are facing, one that demands effective, nonpartisan policy response. We need to:
- provide effective alternatives to foreclosure that minimize the disruptions to households and neighborhoods
- clear the inventory of vacant homes using rental conversion and others means in ways that stabilize housing markets and protect neighborhoods
- ensure that credit is broadly available to responsible borrowers
- renew federal support for housing programs that create affordable homeownership and rental opportunities for low-income households while strengthening communities