For the last six months, Barack Obama and Mitt Romney have battled ferociously to be seen as the true champion of the middle class. Yet neither candidate has offered concrete solutions for — indeed they have rarely raised — a central economic issue: the housing crisis.
How can the collapsing home prices that pummeled the middle class hardest — accounting for three-quarters of the loss of wealth since 2007 — not be a campaign issue? Why is a principal cause of the economic downturn the focus of so little debate?
One explanation is simple. Across the country, the housing market is picking up. In September, new home construction increased by fifteen percent, its fastest rate in four years. And after seeing home mortgages become economic yokes that prevented their parents from moving out of depressed areas, many young Americans are less interested in buying homes.
For existing homeowners and the government, though, housing remains an enormous issue. If new government initiatives are not implemented, it could take another three to five years for the market to fully recover, analysts estimate. And The Wall Street Journal reports that neither candidate has offered ways to remake failed mortgage giants Fannie Mae and Freddie Mac, which have already cost taxpayers $140 billion and face further losses.
Across the United States, nearly 10.8 million properties — 22 percent of homes with a mortgage on them — remain underwater, according to CoreLogic, a data analysis firm. The numbers of properties where owners owe more than their home is worth is shrinking, but analysts say the process can, and must, be sped up.