All of this data, and the data in my last entry, are a matter of freely available public record. You can get the data from any of the 100 counties in NC and no data subscription is needed, although cumulating and organizing the data will be required.
So what does all this mean?Simple. For Wake county, the "real" foreclosure rate and percent change are considerably lower than the collective media advertises. The following table shows the Foreclosure Rate as percentage of households2, and compares3 the data from public record to data from RealtyTrac, one of the largest and well know sources for foreclosure data:
|2007||"real" Foreclosures||"real" Foreclosure Rate||Foreclosures||Foreclosure Rate|
Of interest in the above table is the last column. The RealtyTrac numbers match up reasonably nicely with the county public record data. Indeed, this is what we would expect to happen even though RealtyTrac counts are by "metro area" and not by county borders. Note that Raleigh and Cary (RealtyTrac numbers are for Raleigh/Cary) are both substantially within the Wake county borders.
The following table show the percentage changes from the time periods indicated.
|Percent change||"real" Foreclosure Rate||Foreclosure Rate|
|public record 2007 vs. 2006||3.9||8.6|
|public record 2008 vs. 2007||10.7||18.1|
|RealtyTrac 2007 vs. 2006||N/A||122.83|
Just for fun, 2008 public record numbers look like this4:
|2008||"real" Foreclosures||"real" Foreclosure Rate||Foreclosures||Foreclosure Rate|
|Wake Co. Households||1,349||0.41||3,916||1.20|
ConclusionsI make the following conclusions:
- RealtyTrac data regarding 2007 foreclosure rates per household (0.982%) are inconsistent with Wake county public record "real" foreclosure rates (0.37%)
- RealtyTrac data regarding 2007 foreclosure rates per household (0.982%) are consistent with default rates in Wake county -- the public record S-TR rates (1.02%)
- RealtyTrac year over year growth rates of 122% are inconsistent with public record changes in foreclosure, S-TR, and SP filings.
- Investors should consider public records and trends when analyzing regional investment decisions, and compare multiple outside data sources to try to get a grip on reality.
Having the right regional information about the health of your real estate market is essential in making informed investment decisions.
2. According to the Wake county web site, "The American Community Survey estimates that by 2006, Wake County had 325,712 housing units, an increase of nearly 66,000 housing units in six years." For this analysis we hold this 2006 number constant for all years.
3. Note that RealtyTrac numbers are by "metro area," not by county. The household sample size is different.
4. 1,349 "real" foreclosures in 2008 means only 1 household of 241 for the year experienced a foreclosure, or 0.41%. For 2007, the rate would be 1,219 in 325,712 or 0.37%.