Thursday
July 24, 2014

Shadow Inventory Drops 10% From Last Year

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Shadow Inventory Drops 10% From Last Year

Predictions that the nation’s shadow inventory would rapidly rise have yet to materialize, as the shadow inventory continues to show signs of dropping, according to the latest report reflecting July data from CoreLogic. The nation’s shadow inventory has fallen 10.2 percent in July compared to a year ago. 

As of July, 2.3 million properties were considered in residential shadow inventory, which represents a six-month supply. Of those properties, 1 million are from seriously delinquent loans; 900,000 are in some stage of foreclosure; and 345,000 are REOs, according to CoreLogic’s report.

Shadow inventory reflects the number of distressed homes that have not yet been listed on the multiple listing service but will likely reach the market soon. 

“Broadly speaking, the shadow inventory continued to shrink in July,” says Anand Nallathambi, president and CEO of CoreLogic. “The reduction is being driven by a variety of resolution approaches. This is yet another hopeful sign that the housing market is slowly healing.”

Serious delinquencies, a main driver of shadow inventory, fell the most from April to July in Arizona (3.2%), Pennsylvania (2.8%), New Jersey (2.3%), Delaware (2.2%), and Maine (2.2%), according to CoreLogic. 

CoreLogic calculates the shadow inventory by figuring the number of properties that are seriously delinquent, in foreclosure, and held as an REO by banks but not yet listed on the MLS. 

Source: CoreLogic

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