Foreclosures: A national problem, or regional?

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An interesting piece of spot news analysis at Forbes.com indicates the foreclosure ‘crisis’ is a problem limited to the bubble markets of the Southwest and Florida, and the ailing industrial Midwest; in other words, it’s not a national problem at the moment.

From Forbes.com: ‘The rate of mortgages going into foreclosure hit a record in the second quarter, the Mortgage Bankers Assn. said Thursday, but it took pains to say that the numbers were skewed by four large states, and that outside of them, the situation is improving.

‘Foreclosure starts increased significantly in California, Florida, Nevada and Arizona, the MBA said. ‘Were it not for the increases in foreclosure starts in those four states, we would have seen a nationwide drop in the rate of foreclosure filings,’ said Doug Duncan, the MBA’s chief economist.’

More from Duncan: “What is not clear, however, is whether sub-prime ARM loans are causing the problems for California or whether California is causing the problems for sub-prime loans.... Therefore, the problems in these states will continue, and they will continue to drive the national numbers, but they do not represent a national problem.”

Not a national problem -- That’s quite a statement. Whether you agree with that analysis or not, it’s an important point to make here, as we are clearly looking at a weak regional housing market and should keep open the possibility that it’s not as bad elsewhere.

Thoughts? Comments? Insights?
Photo Credit: AP