But the market is good, our tenant profile is deeply undeserved, and although it's not the most socially acceptable thing to say, we have the deepest housing deficit of any state in the nation.

Following the Congressional Budget Office (CBO) approach to computing the NFIP deficit, PCI estimated the annual cash-flow deficit created by explicit rate subsidies to be about $2.0 billion."

Meaning the other 25% counts as a deficit to your overall money that you're bringing in when looking at your DTI. 

I am kind of worry they would not cut their deficit spending.

When I've talked to a few property managers and developers, they've all uniformly said that it will be a drop in the bucket, since our total deficit of housing is over 2,400 units, and many of these permits will take years to build (Link). 

Or do I think that the US government, spending at an annual deficit of +$1.5T annual deficit and $33T in total debt (Annual US revenue is $4.9T so debt is 6.7X total revenue - it's like my friend with a $200K income getting a $1.3M uncollateralized personal loan - backed by his "full faith and credit" - he'd never qualify!)

In fact, we find ourselves in a "deficit of 4 million" U.S. homes.

We did not get any messages back to indicate the taxes were not filed; as we were in deficit for the first few years, we did not expect anything was owing so when the accountant didn't say anything to us we didn't think much of it. 

Meanwhile, late fees and legal fees will be added on, making a bad situation even worse, until eventually it spirals totally out of control and the homeowner is forced out and loses much, if not all of their equity and may owe a deficit balance even after the property is liquidated.As you said, you're in default.

We had a decent enough income and no kids so we could afford the $200 a month deficit.