Dawn, Home Buyer in Irvine, CA

Have you seen this? http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2009/04/08/MNL516UG90.DTL

Asked by Dawn, Irvine, CA Sat Jun 6, 2009

Help the community by answering this question:


Hi Bob!

Not sure what you are referring to. No, I have not read all of this home buyer's posts but this post alone contains a link that I reviewed this week online along with many other articles and write ups on the subject of "shadow inventory". My agents are having a difficult time locating available properties for our many buyers. The supply of homes is weak at best and frustrating for all.

The inventory in what you might consider the foreclosure capital of the country outside of Arizona, Nevada and Florida is drying up quickly. However, you and I know that foreclosures continue at a steady rate with forecasts of surmounting properties defaulting even on prime fixed rate loans.

So I ask....where are these reported bank owned properties and why do the banks get to regulate the ebb and flow of our regional economic structure?

Diane Wheatley, Broker
diane @moveupproperties.com
2 votes Thank Flag Link Sat Jun 6, 2009
As a matter of fact I was researching this exact subject on Google last night. "Shadow Inventory". That is the talk of the town here in the Inland Empire.

I find it very interesting that the lending institutions are allowed so much power or control over our current inventory to the extent that this withholding of properties for sale has caused "mini bubbles" to appear in our regional market. Supply and demand at the hands of the lenders that had their hands in the honey pot filled with today's mortgage meltdown.

I have a lot of opinion regarding this issue but I'll save it until I can attempt to rationalize it in a more diplomatic manner. Thanks for sharing!

Diane Wheatley, Broker
(909) 815-4499
1 vote Thank Flag Link Sat Jun 6, 2009
Hello Diane,

You should probably read all 4 or 5 threads that Dawn has started here today, on pretty much the same subject. I don't know if you will be able to formulate an opinion useful in San Berdoo County, but you might have a more relevant understanding than if you only read PAID bubble blogger fodder on Google.

Good luck to you out at ground zero.
0 votes Thank Flag Link Sat Jun 6, 2009
Dawn, you might have a more cohesive conversation if you would simply confine your thoughts to one thread, rather than start a new one for each thought - since they all seem to be related, anyway.

To answer your question above, YES, I have seen numerous articles like the one above, seemingly all cut & pasted from one source - RealtyTrac.

One problem with the data in the article is that it is at least 4 months old, and probably older.

As for the potential effect of this alleged shadow inventory, on prices in Orange County, I have already addressed that in the OTHER 4 or 5 threads you've started.
0 votes Thank Flag Link Sat Jun 6, 2009
That is the best data I have seen but the story is distorted.

Look at the data 20k homes is 10 months inventory as Feb Sales levels which are typically low. At the end of February supply and demand were equal. If the banks did nothing but release one home into the market for every one they sell then by next month there will be another housing shortage and prices should be moving up (artificially).

Its clear the banks are moderating the release of inventory. It's not a doomsday scenario. Assuming the greater economy starts to revover we should be out of the worst of it by the end of next year.
Web Reference: http://bob2sell.com
0 votes Thank Flag Link Sat Jun 6, 2009
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