The latest slew of questionable foreclosure statistics and reporting has hit the press, this time out of Idaho. This particular headline was especially peculiar as Idaho rarely has ominous headlines about its respective foreclosure rates.

The Idaho Article comes from a local news station, LocalNews8, titled, “Idaho Foreclosure Rate Among Nation’s Highest.” The article written by Aman Chabra was troubling considering that if Idaho has one of the nation’s highest foreclosure rates, then the economy may truly be heading to shambles.

The article reads, “According to RealtyTrac.com, 1 out of every 479 houses in Idaho has been foreclosed on. That rate ranks Idaho 10th in the nation behind bigger states such as California, Florida and Arizona.”

To verify that RealtyTrac actually reported that Idaho ranked 10th in the nation, their November statistical report (RealtyTrac Report) was referenced and in fact, Idaho was ranked 10th in the nation. However, this ranking is based on foreclosure filings. According to the article, “1 out of every 479 houses in Idaho has been foreclosed on” when in fact, 1 out of 479 homes received a foreclosure filing. Only 61 homes were actually foreclosed on and only 612 received a notice of trustee sale. Recipients of the notice of trustee sale often times manage to avert foreclosure.

When paired with the US Census numbers, at most, 1 out of 767 homes were foreclosed on, not 1 in 479. As mentioned above, this does not even include those that redeemed just prior to the sale.

Not only is the reporter giving incorrect information, but there is another issue with the Idaho foreclosure figures. Referring back to a past expose on Foreclosure Research, RealtyTrac does not even focus on areas of less than 25,000 in population, as they have said so on numerous occasions. Considering this, 32 of 44 counties have populations of less than 25,000.

Taking into account all the new information, it is misleading to rank Idaho as 10th in the country as the ratio between notice of trustee sale to actual REO is dramatically low. Other factors that make this article misleading is the high volume of rural areas and low total household numbers, which make the rate per household unusually high.

With the year coming to a close, many companies and researchers are eager to predict the outcome of the 2009 market. With the economy hovering in a state of uncertainty, the upcoming New Year is on everybody’s mind. Real estate especially has seen a tumultuous year with the rise and fall of foreclosure rates, although the industry has seen more increases than decreases.

Foreclosure listing companies have offered a variety of foreclosure statistics throughout the year. Some reporting more accurate numbers than others, but all in all giving their representation of the market. Now these companies, utilizing their data and statistics collected throughout the year, will offer their own predications for real estate in 2009. In true form, the predictions are on opposite sides of the spectrum.

An article published on December 10, 2008 titled, “Prediction: market to recover in 2009,” offered one foreclosure forecast. According to the article, Alexis McGee, president of foreclosureS.com, stated that “Based on November’s foreclosure rates …the nation’s foreclosure hemorrhage has finally slowed and 2009 should see a significant decline in foreclosures as buyers return, pushing home prices up and fueling a real estate recovery.”

However, according to a different article, a competitor thinks differently. This article from Bloomberg titled, “Foreclosure Storm Will Hit U.S. in 2009 as Loan Changes Fail,” offers a prediction from Rick Sharga, vice president of marketing for Realty Trac.

The article quotes Sharga as stating, “We’re going to see a pretty significant storm next year.” The article continues, “Rising unemployment, expiring foreclosure moratoriums and state efforts that ‘run out of steam’ will push monthly filings toward the record of more than 303,000 set in August.”

As this Foreclosure Research title suggest, not even foreclosure experts truly know what will happen in the coming year. If accurately reporting present and past figures has proven to be a vexing task, then predicating the future is pretty much impossible.

With third quarter reports still trickling in, foreclosure research agencies continue to take varying approaches to how their foreclosure numbers are reported. One method is no less confusing that the next, especially when confounded with reporter bias.

Take the latest foreclosure statistics article published on December 5, 2008, from the website, CNNMoney.com. The article is titled, “Foreclosures soar 76% to record 1.35 million,” and is written by Tami Luhby. The article offers a totally different approach to presenting foreclosure statistics by providing the ‘default rate’. The ‘default rate’ is not to be confused with the rate at which foreclosures increase or decrease from one period to another, but rather the rate at which all borrowers have foreclosed or defaulted on their loans. This method is less popular throughout the media and may lead to confusion for readers (even experts!).

In addition to a confusing use of the rate of default, the article also confuses the process of foreclosure with actual foreclosed homes. For example, the article mentions that “1.35 million homes were in foreclosure in the third quarter.” The article continues by saying those figures drove “the foreclosure rate up to 2.97%.”

The problems lies in the fact that the article makes it sound as if there were 1.35 million pre-foreclosures “driving up the foreclosure rate,” when in fact these may be actual foreclosures- or is it pre-foreclosures? Who knows, readers may have already given up on the article by the first paragraph.

The only way a reader would know that the actual rate of loan defaults (not foreclosures) is if they continue reading to the next paragraph, which states that “the number of homeowners falling behind on their mortgages rose to a record 6.99%.” Again, this leads to more confusing figures. Recent articles show that foreclosures have decreased by 7% in the third quarter while this article states that pre-foreclosure rates have rose to 6.99%.

The article offers one last piece of confusing evidence. It states that the figures in the article are provided by the Mortgage Banker’s Association and the figures represent about 85% of all mortgages. Now, this is a problem on its own. Why even bother with a default rate of any kind if it is just a sample of data?