President Obama traveled to battleground Virginia on Wednesday to outline his plan to slow the flood of home foreclosures that he concedes his administration has failed to halt.
Speaking at the James Lee Community Center in Falls Church, Obama detailed a plan, first described in his State of the Union address, that would allow homeowners with privately held mortgages to refinance their homes at record-low rates for savings of about $3,000 a year.
“What this plan will do is help millions of responsible homeowners who make their payments on time but find themselves trapped under falling home values or wrapped in red tape,” Obama said.
Obama rolled out his plan just as Republican presidential candidates were descending on Nevada, ground zero of the housing crisis. Unlike Obama, Republicans have countered that government should not inject itself into the foreclosure process, instead allowing bankruptcies to play out.
“It is wrong for anyone to suggest that the only option for struggling, responsible homeowners is to sit and wait for the housing market to hit bottom,” Obama said. “I refuse to accept that, and so do the American people.”
Congressional Republicans immediately ripped the plan as a carbon copy of previous failed attempts by the Obama administration to resurrect the housing market, a crucial step toward reviving the economy as a whole.
“How many times have we done this?” said House Speaker John Boehner, R-Ohio. “None of these programs have worked, and I don’t know why anyone would think that this next idea is going to work.”
Republican resistance is also rooted in the plan’s $5 billion to $10 billion price tag.
Obama’s inability to turn around the housing industry is one of his biggest liabilities in a handful of swing states, including Virginia, that will determine his re-election fate.
In Falls Church, the median home price fell from $477,000 in 2007 to $390,000 late last year, real estate data show. Given such drops, Virginia Republicans said Obama will be hard-pressed to convince voters that his policies have done anything to help in the state.
“We welcome him coming to Virginia more often because his numbers are bad and getting worse,” said Pete Snyder, chairman of the state GOP’s VA Victory 2012. “This is a sharp, sharp contrast from the message of hope and change. [He looks] like a TV salesman talking about reverse mortgages.”
Obama in 2008 became the first Democratic presidential candidate in nearly 50 years to carry Virginia, but recent polls show that most Virginians believe he doesn’t deserve a second term, and his approval ratings in the commonwealth continue to hover around 40 percent. With stubbornly high unemployment and an enormously popular Republican governor, Virginia is trending from purple to red again.
And in Falls Church, Obama acknowledged that his previous housing efforts had not produced the promised results.
“The programs that we put forward haven’t worked at the scale we’d hoped,” he said. “The truth is, it will take more time than any of us would like for the housing market to recover from this crisis. Home prices started a pretty steady decline about five years ago now. And government certainly can’t fix the entire problem on its own.”
