Proposing housing solutions presents problems for presidential candidates

Florida’s economy rests heavily on housing, which, to put it mildly, has struggled in the years since the bubble burst. So as the Sunshine State takes center stage in the run-up to the Republican presidential nomination, the candidates find themselves confronted with a question central to the health of the state’s—and nation’s—weak job market: What are their plans for solving the housing mess? Visiting the state Monday in advance of the Jan. 31 primary, former Massachusetts Gov. Mitt Romney staged a housing roundtable with eight Floridians who are either facing foreclosure or are watching their insurance or realty companies flounder. As The Washington Post reports, Romney listened to their tales of woe, taking notes on a yellow legal pad and interjecting at points to express empathy. “It’s tragic,” he told them, adding, “It will not always be like this.” But Romney offered no new proposals. Instead, he used the opportunity to lob criticisms at his top rival, former House Speaker Newt Gingrich. Romney isn’t alone. So far, none of the leading GOP candidates have been specific on how they would address the housing crisis—and it’s likely because offering any solution could create a political conundrum. In the years since the crisis took hold, leading GOP economists have proposed that the government back a massive mortgage refinancing program or principal write-downs to help homeowners. Those ideas don’t jive well with the leading Republican ideology of the day, which calls for a smaller government role in the economy. “This is truly a no-win situation if you are a Republican candidate,” says Jaret Seiberg, a senior policy analyst with Guggenheim Partners’ Washington Research Group. “Every answer requires more government help. So from their perspective, you are better off ignoring the problem than trying to put a plan forward.” Check out the full story here; and read the rest of Real Estate Weekly here.