JUDY WOODRUFF: Now, we look at one of the major economic problems on the minds of voters this year, including in Florida: housing.
Jeffrey Brown has the story.
JEFFREY BROWN: Florida may be known as the Sunshine State, but like much of the country, conditions remain poor when it comes to the housing market.
A national report out today, the so-called Case-Shiller index, shows U.S. home prices fell for a third straight month in major metropolitan markets, including Miami and Tampa. In Florida, home values have dropped by 40 percent or more in some areas since the housing bust. Nationwide, prices have dropped by more than a third.
And the foreclosure crisis continues, with nearly 2.7 million foreclosure filings last year. Several states have been particularly hard-hit, including California, Nevada, Arizona, and indeed the site of today's primary election, Florida.
Some voters in Tampa today said they wanted the candidates to offer more solutions to the problem.
SHARRY STEINER, Florida voter: I'm not thrilled with the reactions from them talking about it. I think they have kind of just gone past it. I really don't think they want to talk about it.
JEFFREY BROWN: A map from the NewsHour's Vote 2012 Center helps tell the story.
The Tampa area is one of nearly 30 counties in the state where foreclosure rates have risen substantially, in some cases even doubling, tripling or quadrupling since 2007. The darker the color, the worse shape the county is in.
To date, Republican presidential candidates have largely avoided spelling out specific policies on housing, mainly arguing that fixing the broader economy is the most logical solution. In October, Mitt Romney said in an interview in Las Vegas that it was best to -- quote -- "let the foreclosure process run its course and hit the bottom." More recently, in Florida, he's talked generally about taking measures to turn around the problem.
Most of the focus of the last week, though, has been on the government-owned mortgage giants, Fannie Mae and Freddie Mac. At last week's debate in Jacksonville, Romney took aim at Newt Gingrich's consultancy work with Freddie Mac.
MITT ROMNEY (R): He should have stood up and said, look, these things are a disaster; this is a crisis. He should have been anxiously telling the American people that these entities were causing a housing bubble that would cause a collapse that we've seen here in Florida and around the country.
JEFFREY BROWN: Gingrich attacked Romney in return.
NEWT GINGRICH (R): Gov, Romney owns shares of both Fannie Mae and Freddie Mac. Governor Romney made a million dollars off of selling some of that. Governor Romney owns share -- has an investment in Goldman Sachs, which is today foreclosing on Floridians.
JEFFREY BROWN: In that same debate, Texas Representative Ron Paul and former Senator Rick Santorum both said Fannie and Freddie should be phased out.
For his part, the president used his State of the Union address to call for new legislation aimed at helping those unable to make their mortgage payments.
PRESIDENT BARACK OBAMA: Responsible homeowners shouldn't have to sit and wait for the housing market to hit bottom to get some relief. And that's why I'm sending this Congress a plan that gives every responsible homeowner the chance to save about $3,000 a year on their mortgage by refinancing at historically low rates.
JEFFREY BROWN: The president's principal program for working with lenders to reduce foreclosures has far helped more than 900,000 homeowners get a permanent modification on their mortgage. But that's far short of the original goals of the program. Tomorrow, the president is expected to spell out further details of his newest plan.
More now on housing and the campaign from Jed Kolko, chief economist with Trulia, an online residential real estate site that provides information for buyers, sellers, renters, and agents. And Arian Campo-Flores is a reporter for The Wall Street Journal who's been reporting on housing in Florida. He joins us from Miami.
Jed Kolko, before we get to Florida and the campaign, fill in the national picture for us a bit. What do today's numbers tell us?
JED KOLKO, Chief Economist, Trulia: The housing market is still struggling in most parts of the country, even though we have seen some good news in the past few months. Both sales and construction appear to be picking up a bit, but home prices are still falling, not as much as they did at the worst part of the housing bust, but they are still falling.
And a lot of people have wondered, how can that be? We thought that, if you fixed the economy, the housing market would follow. And we've seen employment growing each month for more than the last year. But the problem is, even with more jobs and growing housing demand, there is so much inventory, so much supply, so many vacancies that's hanging over the housing market that makes it hard for prices to rise.
You may have more people who are demanding housing and are looking to buy, but there are so many homes that are available and could come to market if prices started to rise, that there's nothing to push prices upward until we get rid of some of this inventory.
JEFFREY BROWN: All right, so, Arian Campo-Flores, take us -- that national picture and translate it to what you've been seeing in counties in Florida. What do you -- tell us -- give us a little flavor of the current state of the market there.
ARIAN CAMPO-FLORES, The Wall Street Journal: Yeah.
Well, I spent some time reporting in Volusia County, which is in Central Florida at the eastern end of the I-4 Corridor. The western part of that county in particular, cities like Deltona, De Bary and DeLand, have been especially hard-hit. The prices there have come down 54 percent from their peak.
I saw blocks with four or five, six homes that were in foreclosure, "for sale" signs all over the place. And it has -- I spoke to a lot of people who either faced foreclosure or went through it. And they just uniformly describe this incredibly excruciating, maddening process that takes years of negotiating with banks and, in the course, ruins their credit, and just -- it creates immense frustration.
And I also spoke to those who were their neighbors and feel trapped in their homes because they have seen the property values plummet in their areas, and they just don't really have a way out.
JEFFREY BROWN: So -- just to stay with you, so there you were all week while the campaign was going on. How did this issue play out? What did people tell you they wanted from the candidates, and what were they hearing from the candidates?
ARIAN CAMPO-FLORES: Well, what they said they want is more help for homeowners who are underwater.
They -- folks want the principals on their loans to be written down. They would like these refinancing programs and loan modification programs to reach them. You know, there are -- figures were cited earlier that the administration has put out -- and it's true -- in fact, you know, more than 900,000 people have had permanent modifications.
But none of the people that I spoke to had been able to benefit from any of those programs. And so there's this sense that those -- you know, folks in Washington who have put forth solutions, those have not worked thus far. And what they're hearing so far from the candidates on the campaign trail, on the GOP side are a lot of generalities, but no specific proposals that, you know, would suggest a way out.
JEFFREY BROWN: Well, Jed Kolko, what would you add to that? I mean, it sort of presents an interesting dilemma for some of the Republican candidates, because, for the most part, on economic issues, they're pushing for free market policies. How does that translate into the particulars of the housing market?
JED KOLKO: I think the Republican candidates are in a tough position when it comes to housing policy.
When it comes to voters, housing really is a bipartisan issue. We at Trulia did a survey of consumers, and we found that even a majority of Republicans want the government to support homeownership. And they're actually in favor of most of the types of proposals that are on the table.
The problem for the candidates, though, is almost any policy that you might come up with, such as refinancing, or reducing principal, loan modification, will either cost somebody some money -- and that somebody is probably going to be the government or the banks, or both -- and it's very hard to separate people who are underwater or might lose their homes and it's entirely not their fault from people who might have taken risks or made bad decisions that maybe they shouldn't be bailed out for.
Democrats are a lot more willing to accept that some people who may be less deserving could be helped than Republicans are. And Republicans are a lot less willing to burden either the government or banks with more money. So, it means that even though Republican voters want to hear from their candidates some kinds of policies that might help the housing market, Republican candidates face these land mines of the challenge of spending more money and the reluctance among lots of Republicans to help undeserving homeowners.
JEFFREY BROWN: Of course, at the same time, Jed Kolko, the Obama administration, with a more interventionist approach, is still finding this a very tough nut to crack, right? It's still a big problem.
JED KOLKO: That's right.
What Obama proposed in the State of the Union address probably needs congressional approval. And we know how that usually goes. But another irony of the whole debate over housing policy is that some of the most innovative and daring ideas have actually come from advisers and economists and other policy wonks who traditionally advise Republicans.
So the ideas are there. It's just that -- current politics that make it hard for the government to spend money. And to have to deal with this question of separating the deserving from the undeserving homeowners make it very hard for Republican candidates to talk about these policies in the campaign.
JEFFREY BROWN: Arian Campo-Flores, bringing it back to Florida, I'm just wondering if you see any bright spots there. Florida still being a very desirable destination for so many people around the country, is there some hope of more people coming in, picking up some of these houses? Are there some signs that people point to?
ARIAN CAMPO-FLORES: There are some.
I mean, you know, in the Miami area, for instance, there's been a lot of international buyers that have come in that are scooping up properties that were -- and all these condominiums that were overbuilt during the boom period, and paying all cash. And so they're starting to eat up some of that inventory.
In Volusia County, where I spent time reporting, you're seeing, again, people taking advantage of the really low prices, buying up properties that they're then renting out or using them sort of as investments. So that is starting to happen and it is helping.
I spoke to the property appraiser in Volusia County, who felt that the market was probably pretty much at the bottom. But there is just still so much inventory left, that it's just going to take a long time for that to really have a noticeable impact in these neighborhoods.
JEFFREY BROWN: Jed Kolko, just 30 seconds or so here, but does that fit into the national -- any part of the national picture?
JED KOLKO: Yes.
On Trulia, we see many more people from outside of Florida searching for homes in Florida than people in Florida looking to leave. Florida's long been the retirement community for so much of the U.S., and baby boomers will still be retiring. And now that homes are more affordable in Florida, some of those baby boomers who thought they'd have to look for cheaper locations in the South can now consider Florida again for their retirement.
JEFFREY BROWN: All right, Jed Kolko, Arian Campo-Flores, thank you both very much.
ARIAN CAMPO-FLORES: My pleasure.