By Peter Ricci
President Barack Obama and Republican presidential nominee Mitt Romney squared off in Denver last night in the first of three presidential debates, and though the debate (which focused solely on domestic policy) mainly generated headlines on the topics of healthcare, taxation and the fate of Big Bird, there were a couple interesting exchanges between the candidates on housing policy and real estate.
Housing Policy Debate – No Qualms With Housing Today?
Obama was the first to mention housing, listing its recent resurgence as one of his first term’s main accomplishments. As Jed Kolko, Trulia’s Chief Economist, wrote following the debate, whether one looks at construction, home prices or housing inventory statistics, housing has certainly improved from 2011.
However, though there are elements of housing that still need some work – distressed housing chief among them – Romney did not challenge Obama’s assertion, despite the fact that, as we’ve covered, his housing policies differ from the president’s.
The Housing Policy Debate For the Future
One area where the candidates disagreed in a pronounced way, though, was the the future of housing policy, and how home financing should be handled following the financial crisis of 2008:
- The segment began with a prompt from moderator Jim Lehrer on regulation, and though Romney spoke in favor of regulation (stating that no free market can exist without regulatory boundaries), he criticized the Dodd-Frank bill as overreaching and, as a result, stifling to the residential mortgage environment.
- Lending has been restricted, Romney continued, by uncertainty. Because so many of the provisions in Dodd-Frank remain undefined (particularly the “qualified mortgage” standard, which Romney specifically mentioned), banks are hesitant to resume their normal lending patterns; and indeed, that is a viewpoint we’ve heard from a number of real estate professionals.
- Of course, Obama disagreed with Romney’s perspective, referring to the deregulatory environment and recklessness of the nation’s banks leading up to the financial crisis, and the need for stronger regulations to curtail future financial speculation.
Both candidates have been criticized for not speaking more directly about real estate and housing policy; though it was addressed in an indirect way, did the debate further the discussion on housing policy, or should it have been addressed more directly?