Shadow inventory threatens housing recovery
By Les Christie, staff writer
January 20, 2011: 7:34 AM ET
NEW YORK (CNNMoney) -- There is a growing glut of foreclosed homes threatening to hit the market over the next couple of years, potentially delaying any recovery.
There were 1.7 million homes either owned by the bank or in some stage of foreclosure at the end of the third quarter of 2010, according to a recent report by Standard & Poor's. It would take 44 months, at the current rate of sales, to sell them off -- a 25% increase from the beginning of 2010. (S&P does not count home loans backed by Fannie Mae and Freddie Mac.)
This so-called "shadow inventory" may depress home values and delay the housing market recovery.
"The problem is you have all these properties coming down the pipeline that are nearly certain to hit the market. That's going to be a negative for the supply-demand equation," said Diane Westerback, Managing Director for S&P and an author of the report...
http://money.cnn.com/2011/01/20/real_estate/shadow_inventory_rise/index.htm
By Les Christie, staff writer
January 20, 2011: 7:34 AM ET
NEW YORK (CNNMoney) -- There is a growing glut of foreclosed homes threatening to hit the market over the next couple of years, potentially delaying any recovery.
There were 1.7 million homes either owned by the bank or in some stage of foreclosure at the end of the third quarter of 2010, according to a recent report by Standard & Poor's. It would take 44 months, at the current rate of sales, to sell them off -- a 25% increase from the beginning of 2010. (S&P does not count home loans backed by Fannie Mae and Freddie Mac.)
This so-called "shadow inventory" may depress home values and delay the housing market recovery.
"The problem is you have all these properties coming down the pipeline that are nearly certain to hit the market. That's going to be a negative for the supply-demand equation," said Diane Westerback, Managing Director for S&P and an author of the report...
http://money.cnn.com/2011/01/20/real_estate/shadow_inventory_rise/index.htm
