In Arizona, Michigan Santorum Plays the Housing Card

The GOP candidates face off today in two states hit hard by the housing slump.

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As voters in Arizona and Michigan headed to the polls Tuesday, former Sen. Rick Santorum keyed into a prickly issue that's been skirted for much of the GOP presidential nominee race: the future of the housing market.

Save for a couple of round tables by Mitt Romney in Florida and a reference in a speech here and there by Newt Gingrich, the candidates have basically avoided the issue of the nation's housing collapse.

But Arizona and Michigan have suffered greatly from the housing bubble and crash, a fact seemingly not lost on Santorum, who laid out his plan to "restore the American Dream" in a column for the Michigan Capitol Confidential Monday.

"It's hard to imagine the American dream that doesn't include the opportunity for American families to buy their own home," Santorum wrote. "Past policies have endangered that pursuit. It's time to get America's housing market back on the right track."

That's music to the ears of home owners battered by steep price declines in Arizona and Michigan, where 47 percent of Arizonans and 35 percent of Michiganders are stuck with homes that are worth less than the mortgages pegged to them, according to Santorum.

His message may resonate even more on recent news that home prices dipped again in December and will most likely continue to fall through 2012, potentially burying more Americans further under crushing debt. To help offset steep home price declines, Santorum proposes allowing Americans to deduct home value losses from their taxable income, in effect lightening their tax burdens and padding their wallets a bit.

Santorum also took aim again at the much-maligned federal mortgage giants Fannie Mae and Freddie Mac, promising to phase out the embattled government-sponsored entities over several years. Fannie Mae and Freddie Mac "shoulder the blame for the housing crisis of 2008," Santorum wrote. "It's unacceptable the president has protected Fannie and Freddie."

Whether Santorum's timely acknowledgement of the ravages of the housing crisis will win him votes in Arizona and Michigan remains to be seen. He faces a steep uphill climb in Arizona where Romney has more than 15 points on him, according to the latest projections. Michigan is another story, where Romney hangs on by a thread with a 1.5 point lead going into the vote tonight.

mhandley@usnews.com

Twitter: @mmhandley

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