CoreLogic, a leading provider of consumer, financial and property information, analytics and services to business and government released a report showing that the Shadow Inventory dropped again late last year.
Should we be afraid of the Shadows?
Shadow Inventory is a term used to describe unsold real estate that is either in foreclosure or homes that owners are delaying putting on the market until they feel that prices are rising. Shadow inventory often causes homeowners to question whether it is a good time to sell their homes and when they can see rises in prices..
According to CoreLogic, this shadow inventory fell 12.3 percent from the previous year.
“The size of the shadow inventory continues to shrink from peak levels in terms of numbers of units and the dollars they represent,” CoreLogic Chief Executive Anand Nallathambi said in a press release. “We expect a gradual and progressive contraction in the shadow inventory in 2013 as investors continue to snap up foreclosed and REO properties and the broader recovery in housing market fundamentals takes hold.”
CoreLogic estimates the supply of homes that are seriously delinquent, in foreclosure or held by lenders and not currently on the market. Investors and economists keep an eye on shadow inventory to get a sense of how many homes might be headed into foreclosure and hitting the market.
CoreLogic estimated the dollar amount of shadow inventory as $376 billion in October, a decline from $399 billion the same month a year before. Florida, California, Illinois, New York and New Jersey account for 45 percent of these shadow properties recently reported by CoreLogic.
CRESTICO is a full-service Real Estate Brokerage and Mortgage Lending firm in Los Angeles, California.
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