In the midst of foreclosure reports touting the worst of the real estate market meltdown, one article seemed to stray away from the pack. Published on March 2, 2009 on The New York Times Web site, the article headline reads, “Foreclosure Rates Aren’t Really That High…”

While many would say otherwise, the fact that the article was such a departure from the usual doom and gloom warranted a further look. According to the article by Catherine Rampell, a new study out of the University of Virginia states that foreclosures are not as rampant as one may assume.

An expert from the article reads:

“A new study takes issue with the media narrative that foreclosures are dangerously widespread. The paper’s authors, William Lucy and Jeff Herlitz at the University of Virginia, examined foreclosure rates in every state, 35 metropolitan areas and 236 counties, and they found that 62 percent of foreclosures in 2008 were in the four states mentioned above.”

Those four states include Florida, California, Nevada and Arizona. The article continues, “[California] may have had only 10 percent of the nation’s housing units, but it had 34 percent of the nation’s foreclosures in 2008.”

According to the study, homes that people were purchasing in California at the peak of the market were, “quite expansive” compared to the homebuyer’s income. In Los Angeles County 20% of all mortgage holders were utilizing at least 50 percent of their household income for housing related expenses. The new norm for housing costs, stated by the Obama administration, should be below 30% of household income.

Another interesting aspect of the article is that while the authors were questioning some media reports, readers were questioning the authors, in respect to their seemingly conflicting foreclosure figures.

Here is an excerpt of the author’s response:
“Foreclosure data are difficult to compare from one source to another… These processes may be interrupted by delinquencies being paid, changes in lenders’ enforcement policies, or legislation requiring delays in foreclosure proceedings. The same property may be listed multiple times (Olick 2007).”

According to the article, the differing data comes from two foreclosure listing companies. One for which the authors used as the more credible source, and another listing company.

“RealtyTrac’s data for foreclosure proceedings (2.3 million) more than doubled the foreclosure rate of foreclosure.com in 2008. But RealtyTrac reported “more than 860,000 properties were actually repossessed by lenders” in 2008 (Associated Press 2009). Foreclosure.com’s website said “home foreclosures jumped 64% to nearly one million homes in 2008.” In our study, we used foreclosure.com data for states and counties, usually from November 2008. The U.S. number of foreclosures and preforeclosures in that source was 1,009,485…”

The differing numbers makes sense as Realty Trac reports multiple listings on a single property, which has been reported by Foreclosure Research in the past.