This is another information link to explain the current market conditions. Today the discussion is about Shadow Inventory.
The term Shadow Inventory indicates the amount of homes that Banks have in their back pocket, so to speak, that will eventually be released to the market. The significance of it is that we have to work our way through all the inventory, or most of it, in order to get through this economic downturn. The banks have been holding onto thousands of homes before putting on the market, as they can only handle so many at a time. The Foreclosure process is very labored and banks are overwhelmed. According to the web site, www.houserepos.net, thousands of homeowners are struggling to go through loan modifications first, which has also slowed the process down and elongated the time a home gets to foreclosure.
I have included a picture of a map of the United States indicating how many months each state has of shadow inventory. Washington State is fortunate to have only 4 months! That is tremendous, against some states with 12, 18 and even as much as 34 months for the state of New Mexico and 65 for New Jersey. Wow!
Here is a pdf of National Shadow Inventory and Washington State Inventory county by county. Shadow Inventory & WA State Inventory. If you have questions, don’t hesitate to ask.
Basically, what this demonstrates is that Washington State, with only 4 months indicated of shadow inventory, stands very strong in the overall economy of foreclosures and recovery from this economic downturn.
More in next segment on the significance to us in the Seattle area.