What is Shadow Inventory? ~ Hampton Roads Real Estate Ramblings

What is Shadow Inventory?

Sunday, March 25, 2012

Hello Hampton Roads,

Have you heard of the term "Shadow Inventory" and wondered what it meant?

Shadow Inventory consists of the following:

  • Homes 90 days delinquent on the mortgage--97% of people who are 90 days delinquent on their mortgage end up selling their home in some sort of distressed property sale (either a foreclosure or short sale)
  • Houses already owned by banks but not yet on the market
  • Houses already in the foreclosure process but not yet foreclosed
Below is a picture showing month's supply of inventory by state--this data is taken from the latest NAR (National Association of Realtors) from Nov 2011.

Virginia is shown to have a 14 month supply.  Expect to see more of this shadow inventory released this year and in 2013 as a result of the national mortgage settlement which gives guidelines on how banks are to proceed with foreclosure.

Thanks for Reading,

View Liz Schuyler- CDPE, SFR, e-PRO's profile on LinkedIn
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