The politics of home price depreciation

Another foreclosure, another new Democrat? Housing bust math is no fun for Republicans

Published November 7, 2007 12:00PM (EST)

In Tuesday's Los Angeles Times, Maura Reynolds reports that the housing crisis is beginning to gnaw away at Republican strength in the so-called "exurbs" that have been the locus of much recent development, and an even more recent wave of foreclosures and home price collapse. (Thanks to Calculated Risk for the tip.)

The bulk of the article focuses on Virginia's Loudoun County, where foreclosures have risen from 12 in 2005 to 139 in 2006 to 643 in just the first 9 months of 2007. But the trend is supposed to be worrying Republican muckety-mucks all over the nation.

The shift is not confined to one county in the mid-Atlantic region. Similar rumblings of discontent can be heard among GOP voters in fast-growing areas across the country that are being hit by the housing crunch, including parts of Florida and Nevada.

For Republican strategists, the change is particularly troubling because, as recently as 2004, high-growth exurban areas like Loudoun County were fertile ground for GOP organizers, who rallied conservative volunteers from churches and community groups to turn out new voters. It was primarily in such areas that Republican strategists beat Democrats at their own game -- registration and voter turnout.

The money quote comes from Florida Republican Tom Slade, a former state GOP chairman:

The "For Sale" sign in the frontyard of Slade's sprawling house on the outskirts of Jacksonville, Fla., has been there for the last 18 months without attracting a buyer, even though the house is listed well below its appraised value.

"How deep, bad and big this monster will turn out to be is not clear yet, but it has the potential to turn wickedly mean," Slade said. "Who gets the biggest thumping is anyone's guess, but I would guess it would be the Republicans since we've had control of the executive branch."

Wickedly mean. I guess that means Slade doesn't think the housing bust has reached bottom, but then, you'd be hard pressed to find anyone willing to say the worst is over right now. The latest news from the home-building front is flat-out catastrophic. To pick just one of the latest data-points: More than a year into the bust, Hovnanian, an upscale home builder (you know, the kind that exurban Republicans are wont to purchase), reported on Thursday that October sales had "significantly deteriorated," and that would-be homebuyers canceled contracts at the phenomenal rate of 40 percent in its recently concluded fourth quarter. Similar reports abound.

But it just all seems, so, I don't know, fickle. Just a few years ago, you couldn't ride your bike down a suburban street without being run over by an Ford F250 with a bumper sticker reading "permanent Republican majority." But just a few option ARM resets later, and suddenly, the people just can't take it any more.


By Andrew Leonard

Andrew Leonard is a staff writer at Salon. On Twitter, @koxinga21.

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