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62 is what happens when policies put middle class families first. "And let there be no doubt—thanks to the steps we took early on to rescue our economy, to rebuild it on a new foundation, America is coming back. "ere are workers today with jobs who didn't have jobs last year," he continued. "ere are families who've got health insurance who didn't have health insurance before. ere are students who are in college who didn't think they could afford it before. ere are heroes who have served tour after tour who are finally home with their families. ere are auto workers who are building great American cars now when they thought that those plants were going to shut down." It's a compelling story: e economy is in the doldrums, lines at the unemployment office are out the door, and the Obama Administration swoops in riding a white horse to save the day. But as was the case with many executives that preceded him, the president may be overstating how far the housing market has come back and the administration's role in the recovery. "We have come back off the bottom of one of the worst housing busts in the country's history," said Rick Sharga, EVP at Auction.com. "But we're still closer to the bottom than we are to the peak of the market during the housing boom. "Prices have recovered, but are back to 2004 levels, meaning that we've still essentially lost a decade of equity. So there's still quite a bit of room for expansion, and most people, myself included, are predicting that 2015 will be flat compared to 2014, and that 2016 may not be much better. So the market has gotten better, but it's hardly robust." Sharga said that the progress the housing market has made so far was brought about by several factors. "And it's important to note that this 'recovery' was facilitated by unprecedented action by the Federal Reserve; several years of historically low interest rates; and government-backed lending that accounts for about 96 percent of all loans being issued," he said. "In a lot of ways, housing is still on life support; in stable, rather than critical condition, but hardly ready to fend for itself." e same could also be said for the national unemployment rate, which directly correlates to the strength of the housing market. e national unemployment rate was 5.6 percent in December, lower than at any other point in the Obama presidency. is is the traditional rate that gets reported monthly and garners the headlines. Unfortunately, the December rate is almost 11 percent when factoring discouraged, able-bodied potential employees that have left the workforce and part-time workers who would prefer full-time work. at rate, known as the U-6, is still higher than its pre-recession level. CHAMPIONING REGULATORY REFORM Part of the administration's case taking credit for the turnaround in the economy is centered upon the imposition of enhanced regulation to fix the type of systemic issues that they maintain lead to the financial crisis before they came to power, thereby preventing another meltdown. In Phoenix, the president singled out the creation of the Consumer Financial Protection Bureau (CFPB) in 2010 as part of the Dodd- Frank Wall Street Reform and Consumer Protection Act and the record settlements that have been reached with financial institutions in the last year for engaging in predatory lending practices that led up to the financial crisis. While the Obama Administration created the CFPB as part of Dodd-Frank, the impact of the Bureau on lenders and housing as a whole may not be all positive, Sharga said. "And the CFPB, with its QM and ATR rules, along with some of the regulatory uncertainty the administration has fostered with its record financial penalties to lend- ers, has essentially caused lending to all but the most qualified borrowers to seize up," he expanded. "is might be one way to define 'stability,' but it's not doing much for the housing market, or for the broader economy." e White House is quick to dismiss criticism of the new regulatory structure. "At every step, we were told our goals were misguided or too ambitious; that we would crush jobs and explode deficits," the president opined in his State of the Union address. "Instead, we've seen the fastest economic growth in over a decade, our deficits cut by two-thirds, a stock market that has doubled, and health care inflation at its lowest rate in 50 years." But a new Republican Congress has already begun to attempt to poke holes in Dodd-Frank, with the House passing a two-year delay in implementation of the "Volcker rule," named for former Federal Reserve Chairman Paul Volcker. e rule requires large banks to sell-off financial investments known as collateralized loan obligations (CLO). Proponents of the rule maintain that banks' continued involvement in the risky CLO market could potentially trigger another financial crisis, while the rule's opponents claim it is necessary for "Prices have recovered, but are back to 2004 levels, meaning that we've still essentially lost a decade of equity. So there's still quite a bit of room for expansion, and most people, myself included, are predicting that 2015 will be flat compared to 2014, and that 2016 may not be much better." — Rick Sharga

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