Why not?
PPI’s Battleground Home Values Index for January 2012 shows home values staying essentially flat in 15 of 16 president battleground states. The one exception was Iowa, where a decline in values was severe enough to drag down the entire index by two points—the lowest level this year. According to our index, the weighted average of median home values in these states is now down a total of 18% since October 2008.
In the Hawkeye state—the one state where prices took a more serious downward turn—median values have fallen sharply from October 2011 ($124,400) to January’s low ($108,500).
While most pundits seem focused on rising gas prices as the reason for the recent drop in the president’s approval ratings, the continuing slump in home prices might offer another explanation. People still don’t quite feel they’ve regained the wealth they’ve lost in the recession.
The president himself might see the connection—in recent weeks, the administration has unleashed a flurry of new housing initiatives aimed at addressing the slump. These initiatives, combined with an improving economy and a renewed governmental focus on housing after the multi-billion housing settlement recently announced by the states’ Attorneys General, should help blunt housing’s downward momentum.
