In Depth Analysis: CalculatedRisk Newsletter on Real Estate (Ad Free) Read it here.

Monday, November 19, 2007

Oh Good, Now We Can Fire the Intern

by Tanta on 11/19/2007 02:03:00 PM

The OC Register has an interesting story out on the problems with the foreclosure numbers that RealtyTrac reports (and that the media tend to pick up and run with). I suggest you read the whole thing. I got fascinated by this little part:

For example, last year, RealtyTrac's data showed Colorado had the nation's highest foreclosure rate. That didn't sit well with state officials, who decided to do their own count of foreclosures and came up with a figure much smaller than RealtyTrac's. . . .

RealtyTrac counted 54,747 "foreclosure actions" in Colorado last year.

That number wasn't useful because it didn't reflect how many homeowners were actually in danger of losing their homes, said Ryan McMaken, spokesman for the Colorado Division of Housing. "We couldn't really use those numbers for having serious discussions," he said.

So McMaken put an intern to work calling all of the state's 64 counties to get a count of how many homes entered the foreclosure process last year. The number he came up with: 28,435.

This summer, partly in response to criticism, RealtyTrac began sorting its numbers to compile a separate count of properties in foreclosure, in addition to total foreclosure actions. RealtyTrac's "unique property" count, published quarterly, found 19,411 properties in foreclosure in Colorado in the first half of this year. That's within a few dozen of the 19,460 counted by McMaken.

"I think they're getting a lot closer now," McMaken said, adding that "we might not have to collect our own numbers" anymore.
So Colorado had no state-wide numbers for foreclosures. It didn't feel the need to have any until RealtyTrac made it look bad. So it got an intern to get on the telephone and call up counties and make a running list (with a spreadsheet? Or a ruled legal pad?). It then demonstrated that RealtyTrac's numbers were exaggerated. And so . . . now it can quit tallying its own numbers and go back to relying on the Associated Press to tell it what's going on in its own state? Um.