trrenter_IHB
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[quote author="Geotpf" date=1254431993][quote author="awgee" date=1254430694]<em>"I love how some pundits argue that the shadow inventory will cause no problem on the markets or even, that it doesn?t exist."</em>
From <a href="http://www.doctorhousingbubble.com/shadow-inventory-case-study-inventory-in-the-shadows-twice-as-big-as-normal-resale-inventory-in-los-angeles-and-not-on-the-mls-or-for-public-viewing-foreclosures-and-distress-properties-clogging-t/">Dr. Housing Bubble on shadow inventory</a></blockquote>
It seems that, in that post, the good Doctor is including properties in default but not yet foreclosed upon as being part of the shadow inventory. I agree that there are a lot of that type, but at least some of those properties will not become bank owned.</blockquote>
Geotpf the common defintion of shadow inventory is "Shadow inventory is housing units that are not making it onto the public market for one reason or another.?
It is not just housing units that have been foreclosed on that the bank has not put on the MLS yet.
I think you would agree that before the bubble burst most of these people in foreclosure would just put their houses on the market and reap the reward of double digit appreciation for a home they could never afford.
Historically the cure rate for delinquent Prime mortgages was 45% now it is 6.6% so yes some of the homes you are talking about will never make it to the bank. I would guess somewhere between 6% at the worse and 45% at the best. At least that is what history tells me.
So I may agree that Foreclosure radar isn't the best place to get ALL of the info on shadow inventory we can use the data to make some fairly conservative projections about what WILL eventually come on to the market.
Conservatively 55% or all homes that are on foreclore radar will end up being a unit for sale at some point. As a worse case scenario 93.4% will end up being units for sale at some point.
I don't think you can argue that in normal times the banks and lending instutitions were processing these foreclosures faster as well.
From <a href="http://www.doctorhousingbubble.com/shadow-inventory-case-study-inventory-in-the-shadows-twice-as-big-as-normal-resale-inventory-in-los-angeles-and-not-on-the-mls-or-for-public-viewing-foreclosures-and-distress-properties-clogging-t/">Dr. Housing Bubble on shadow inventory</a></blockquote>
It seems that, in that post, the good Doctor is including properties in default but not yet foreclosed upon as being part of the shadow inventory. I agree that there are a lot of that type, but at least some of those properties will not become bank owned.</blockquote>
Geotpf the common defintion of shadow inventory is "Shadow inventory is housing units that are not making it onto the public market for one reason or another.?
It is not just housing units that have been foreclosed on that the bank has not put on the MLS yet.
I think you would agree that before the bubble burst most of these people in foreclosure would just put their houses on the market and reap the reward of double digit appreciation for a home they could never afford.
Historically the cure rate for delinquent Prime mortgages was 45% now it is 6.6% so yes some of the homes you are talking about will never make it to the bank. I would guess somewhere between 6% at the worse and 45% at the best. At least that is what history tells me.
So I may agree that Foreclosure radar isn't the best place to get ALL of the info on shadow inventory we can use the data to make some fairly conservative projections about what WILL eventually come on to the market.
Conservatively 55% or all homes that are on foreclore radar will end up being a unit for sale at some point. As a worse case scenario 93.4% will end up being units for sale at some point.
I don't think you can argue that in normal times the banks and lending instutitions were processing these foreclosures faster as well.
