Home ‘Shadow Inventory’ Falls to Lowest Since 2008 [View all]
By Prashant Gopal - 2012-06-14T15:22:09Z
The number of U.S. homes that are in the foreclosure process or seriously delinquent tumbled in April to the lowest level in more than three years, helping to stabilize prices, CoreLogic Inc. (CLGX) said.
The so-called shadow-inventory fell 15 percent from a year earlier to about 1.5 million homes and is at the lowest since October 2008, the Santa Ana, California-based real estate information company said in a statement today. That represents a supply of about four months, down from six months in April 2011.
Shadow inventory is falling as banks dispose of properties and approve more transactions where the price is less than the amount owed. Sales of homes in the pre-foreclosure process rose 25 percent from a year earlier to a three-year high in the first quarter, Irvine, California-based RealtyTrac Inc. said May 31. Serious mortgage delinquencies also are down, with the share of payments 90 days late decreasing to a three-year low of 6.86 percent in April, according to data compiled by Bloomberg.
“The decline in the shadow inventory is a positive development because it removes some of the downward pressure on house prices,” Mark Fleming, chief economist for CoreLogic, said in the statement. “This is one of the reasons why some markets that were formerly identified as deeply distressed, like Arizona, California and Nevada, are now experiencing price increases.”