The national stock of distressed properties not currently listed on multiple listing services that are seriously delinquent, in foreclosure and real estate owned by lenders – collectively known as the nation’s "shadow inventory" – fell more than 15 percent in July compared to a year ago.
According to a new report from national real estate tracker CoreLogic, the nation’s shadow inventory stood at 1.6 million units in July, or roughly five months worth of housing supply. Of the 1.6 million properties currently in the shadow inventory, 770,000 units are seriously delinquent; 430,000 are in some stage of foreclosure; and 390,000 are already in REO. As of July 2011, the shadow inventory is 22 percent lower than its January 2010 peak of 2 million units.
CoreLogic said the total shadow and visible inventory was 5.4 million units in July 2011, down from 6.1 million units a year ago. The shadow inventory accounts for 29 percent of the combined shadow and visible inventories. The aggregate current mortgage debt outstanding of the shadow inventory was $336 billion in July 2011, down 18 percent from $411 billion a year ago.
"The steady improvement in the shadow inventory is a positive development for the housing market," CoreLogic chief economist Mark Fleming said in a statement. "However, continued price declines, high levels of negative equity and a sluggish labor market will keep the shadow supply elevated for an extended period of time."
