I wrote a recent article about SHADOW INVENTORY and what it is.
If you missed reading it, you should. Here’s the LINK TO THE SHADOW INVENTORY ARTICLE.
We all know there IS abundant shadow inventory, and of course the BIG question is…
WHAT WILL THE IMPACT BE ON THE HOUSING MARKET???
Experts are predicting a decline in average sales prices on national level during 2012. Estimates vary from 3% (Moody’s Analytics), to 6 or 7% (Chase Manhattan Bank), to as much as 13% predicted by Fitch Analytics.
But, while demand is expected to increase in 2012, the other issue is that there will be an increased supply of housing at discounted prices (foreclosures) as the SHADOW INVENTORY comes to market with the resolution of the Mortgage Settlement Act. The 5 major banks now have a road map to move ahead with the foreclosures that have been stalled/held up due to concerns about robosigning and penalties from the government for not doing the paperwork correctly.
The map below shows the percentage of all mortgages, in each state, that are currently in the foreclosure process [infographic from Corelogic]. As you can see, some states are in good shape, others are not.
SELLERS – you can expect to have more competition because buyers have more options, including foreclosed homes at discounted prices, although again this varies from market to market. And the increased discounted properties will impact appraisals.
BUYERS AND SELLERS need to understand what is happening and why, and how this affects you if you are interested in buying or selling so you can make the best decision and in a timely manner.
STAY TUNED FOR MORE ON THIS VITAL TOPIC