The Big Fail: NV-ermind That Promise

- May 11, 2012

As Families Continue To Struggle, Obama Cites Failing Housing Policies

Today, Obama Will Be In Reno, Nevada, “Among The Places Hit Hardest By The Housing Bust,” To Discuss His Housing Policies. “For example, while in Reno, Nev., during a trip West later this week mostly to raise campaign money, Mr. Obama will push one of the proposals, to allow more families who are current on their mortgages to refinance at lower interest rates. Nevada, a swing state critical to his re-election, is among the places hit hardest by the housing bust.”(Jackie Calmes, “Obama Hands Congress Economic ‘To Do’ List,” The New York Times, 5/8/12)


PROMISE: Obama: “I’ll Also Act Quickly To Help People Stay In Their Homes, Something That’s Especially Critical Here In Nevada Where Foreclosure Rates Are Five Times The National Average.” OBAMA: “I’ll also act quickly to help people stay in their homes, something that’s especially critical here in Nevada where foreclosure rates are five times the national average. I’ll help responsible homeowners refinance their mortgages on affordable terms, and put in place a three-month moratorium on foreclosures to give folks the breathing room they need to get back on their feet. And I won’t let banks and lenders off the hook when it was their greed and irresponsibility that got us into this mess.” (Senator Barack Obama, Remarks At A Campaign Event, Reno, NV, 10/25/08)

Last Month, Pressed By KOLO Reno ABC On His Housing Plans, Obama Could Only Cite His Hardest Hit Fund, Which Had Been Panned That Same Morning

Obama Was Pressed On Nevada’s Large Levels Of Underwater Homes: “Do You Have Any Plans To Address This?” KOLO’S PAT HAMBRIGHT: “And this is a question from one of our KOLO 8 News Now Facebook fans, Don Larson, of Sparks, Nevada. Don says I bought my house approximately 5 years ago; I put 80k down, everything I could. My house is now worth less than half what I paid for it. I always thought my home would be a big part of my retirement and now it’s a huge deficit. What can be done about me and others like me, and keep in mind - 3 out of 5 homes in Nevada, underwater, low reductions, modifications, not much value because they don’t address the issue of principal reduction. Do you have any plans to address this?” (KOLO-ABC’s “News Now,” 4/12/12)

Obama Responded By Touting His Hardest Hit Fund. OBAMA:  “In addition, we’ve actually provided additional dollars to the state of Nevada and some other states that were especially hard hit so that they can deal with the housing crisis and tailor it to the particular needs of the local market.” (KOLO-ABC’s “News Now,” 4/12/12)

But That Same Morning, A Report On The Hardest Hit Fund Was Released Showing The Fund Had Helped Just 30,640 Homeowners Of The 3 To 4 Million Obama’s Treasury Department Estimated “A fund to support homeowners in the communities hit hardest by the collapse of the housing bubble has disbursed just 3 percent of its budget and aided only 30,640 homeowners in the two years since its creation, according to a report released on Thursday by a federal watchdog office. The Hardest Hit Fund, which was created in the spring of 2010, grants money to state housing finance agencies for efforts to help families that are facing foreclosure. … The Treasury Department had estimated that the program would reach three million to four million homeowners.” (Annie Lowrey, “Treasury Faulted In Effort To Relieve Homeowners,” The New York Times, 4/12/12)

  • In Nevada, The Hardest Hit Fund Spent Only 1.75 Percent Out Of A Total Of $194,026,240  Allocated, And Helped A Mere 682 Homeowners. (Christy L. Romero, “Factors Affecting Implementation Of The Hardest Hit Fund Program,” SIGTARP, 4/12/12)

Special Inspector General For TARP Christy L. Romero: “There Needs To Be A Dramatic Increase In The Number Of Homeowners Helped.” “In order to reach the number of homeowners whom the HFAs collectively estimate helping through HHF, there needs to be a dramatic increase in the number of homeowners helped.” (Christy L. Romero, “Factors Affecting Implementation Of The Hardest Hit Fund Program,” SIGTARP, 4/12/12)

“The Report Is Just The Latest To Criticize The Obama Administration’s Efforts To Relieve Homeowners …” “The report is just the latest to criticize the Obama administration’s efforts to relieve homeowners battered by the nationwide drop in housing prices and the broader recession. The office of the special inspector general has repeatedly criticized Treasury’s management of the Home Affordable Modification Program, Washington’s main initiative to prevent foreclosures.” (Annie Lowrey, “Treasury Faulted In Effort To Relieve Homeowners,” The New York Times, 4/12/12)


Last Year, Reno Had The Eighth Highest Foreclosure Rate In The Nation Among Metropolitan Areas. “Other metro areas with foreclosure rates ranking among the top 20 were Phoenix at No. 6 (5.10 percent); Reno, Nev., at No. 8 (4.37 percent); Atlanta at No. 12 (3.69 percent); Prescott, Ariz., at No. 14 (3.50 percent); Cape Coral-Fort Myers, Fla., at No. 15 (3.29 percent); Greeley, Colo., at No. 17 (2.97 percent); Detroit at No. 18 (2.94 percent); Boise, Idaho, at No. 19 (2.85 percent); and Salt Lake City at No. 20 (2.81 percent).” (RealtyTrac, “2011 Year-End Foreclosure Market Report: Foreclosures On The Retreat,” Press Release, 1/12/12)

  • In The Fourth Quarter Of 2011, More Than 50,000 Homes In The Reno-Sparks Area – 53 Percent Of Homes With An Active Mortgage – Suffered From Negative Equity. “In the fourth quarter of 2011, for example, an estimated 50,083 homes in Reno-Sparks, 53 percent of homes with an active mortgage, suffered from negative equity, according to data tracker CoreLogic.” (Jason Hidalgo, “Region Enters Sellers' Market As Homes For Sale Are Dwindling,” Reno Gazette Journal, 5/5/12)

Last Year, Nevada Posted The “Nation’s Highest State Foreclosure Rate For The Fifth Consecutive Year.” “More than 6 percent of Nevada housing units (one in 16) had at least one foreclosure filing in 2011, giving it the nation’s highest state foreclosure rate for the fifth consecutive year.” (RealtyTrac, “2011 Year-End Foreclosure Market Report: Foreclosures On The Retreat,” Press Release, 1/12/12)

  • In March 2012, Nevada Posted The Biggest Monthly Increase In Foreclosure Starts At 153 Percent. “States with the biggest monthly increases in foreclosure starts included Nevada (up 153 percent), Utah (up 103 percent), New Jersey (up 73 percent), Maryland (up 53 percent) and North Carolina (up 47 percent).” (“Q1 2012 Foreclosure Activity Lowest Since Q4 2007,” RealtyTrac, 4/05/12)

In The Fourth Quarter Of 2011, “Nevada Had The Highest Negative Equity Percentage With 61 Percent Of All Of Its Mortgaged Properties Underwater.” “Nevada had the highest negative equity percentage with 61 percent of all of its mortgaged properties underwater, followed by Arizona (48 percent), Florida (44percent), Michigan (35 percent) and Georgia (33 percent). This is the second consecutive quarter that Georgia was in the top five, surpassing California (30 percent) which previously had been in the top five since tracking began in 2009.” (CoreLogic, “CoreLogic® Reports Negative Equity Increase In Q4 2011,” Press Release, 3/1/12)


“Housing Has Blown A Giant Smoking Hole In The Middle Of Our Economy, And The Consequences Continue To Impede The Pace Of Recovery.” “Here’s a reminder about a problem that still doesn’t get the attention that it deserves: Housing has blown a giant smoking hole in the middle of our economy, and the consequences continue to impede the pace of recovery.” (Binyamin Appelbaum, “Measuring Housing’s Drag On The Economy,” The New York Times’ “Economix,” 2/24/12)

  • “Housing Is More Than Half Of Our Problem.” “And, the paper [‘Housing, Monetary Policy, and the Recovery’] says, ‘more than half the underperformance in this recovery is associated with housing-related sectors.’ Yes, that’s right. Housing is more than half of our problem.” (Binyamin Appelbaum, “Measuring Housing’s Drag On The Economy,” The New York Times’ “Economix,” 2/24/12)
  • The Housing Market Continues To Bump Along The Bottom.” “The housing market continues to bump along the bottom. Sales of previously owned homes fell 2.6% in March from February, according to the National Association of Realtors, meaning that the rise in buyer traffic during the mild winter hasn't yet translated into strong sales gains.” (Ben Casselman and Nick Timiraos, “Economic Reports Fan Fears,” The Wall Street Journal, 4/19/12)

“The Alphabet Soup Of Housing Assistance Programs To Date -- HAMP, HARP, EHLP, 2MP -- Have Been Too Poorly Administered And Too Limited In Scope And Eligibility To Slow Or Halt The Slide In The U.S. Housing Market.” (Eric Wieffering, “Fixing economy Requires More Work On Housing,” Star Tribune, 9/17/11)

  • “Every Program Has Fallen Far Short Of Goals.” “‘Every program has fallen far short of goals. I can't think of one that's been largely successful,’ says John Dodds, director of the Philadelphia Unemployment Project, a non-profit that's been involved in foreclosure prevention for decades.” (Julie Schmit, “What Went Wrong With Foreclosure Aid Programs,” USA Today, 12/12/11)

Homeownership Is At Its Lowest Level Since 1997. “The nation's homeownership rate fell to its lowest level since 1997, as the housing market continues its lengthy effort to shake off the puncturing of the subprime mortgage bubble. The U.S. Census Bureau reported Monday that the nation's homeownership rate had dipped to 65.4 percent in the first quarter of 2012, down 0.6 percent from the end of 2011, and down a full percentage point from the same time last year. The rate of homeownership, which is the amount of homes purchased versus the total amount of housing units available, is at its lowest point since 1997.” (Peter Schroeder, “Homeownership Rate Hits 15-Year Low,” The Hill’s “On The Money,” 4/30/12)

  • Home Prices Dropped 3.8 Percent In The Past Year And A “Whopping” 34.4 Percent Since July 2006. “The average home sold in that month lost 0.8% of its value, compared with a month earlier, and prices were down 3.8% from 12 months earlier, according to the S&P/Case-Shiller home price index of 20 major markets. Home prices have fallen a whopping 34.4% from the peak set in July, 2006.” (Les Christie, “Home Prices Hit A 10-Year Low,” CNN Money, 3/27/12)

“This Summer At The White House, Obama Offered A Rare Acknowledgment That His Response To The Housing Crisis Had Fallen Short.” (Zachary A. Goldfarb, “Obama’s Efforts To Aid Homeowners, Boost Housing Market Fall Far Short Of Goals,” The Washington Post, 10/23/11)

  • Obama Said That Housing Has Been The “Most Stubborn To Us Trying To Solve The Problem.” OBAMA: “We’ve had to revamp our housing program several times to try to help people stay in their homes and try to start lifting home values up.  But of all the things we’ve done, that’s probably been the area that’s been most stubborn to us trying to solve the problem.” (President Barack Obama, Twitter Town Hall, Washington, D.C., 7/6/11)
  • President Obama Said “I’ll Be Honest With You, [Housing] Is Probably The Biggest Drag On The Economy Right Now.” OBAMA: “Well, it’s a good question.  And I’ll be honest with you, this is probably the biggest drag on the economy right now that we have -- along with I know the frustrations people have about gas prices.  What we’ve really seen is the housing market, which was a bubble, had greatly over-inflated in all regions of the country.  And I know I probably don't get a lot of sympathy about that here because I can only imagine what rents and mortgages you guys are paying.” (President Barack Obama, Remarks By The President At A Facebook Town Hall, Palo Alto, CA, 4/20/11)

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