According to Foreclosureradar.com, there is no shadow inventory, so good luck to those waiting for a flood of houses to go on the market...
http://www.contracostatimes.com/ci_21312143/bay-area-foreclosures-jump-july
There is no "shadow inventory"
By wave9x Follow Wed, 15 Aug 2012, 4:03pm 16,323 views 183 comments
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So which existing member are you with a new account? Or, which real estate sales office are you working in?
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I neither have another account nor am I a real estate agent. Care to comment on the article? Pretty damning coming from ForeclosureRadar, wouldn't you say?
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To parse out the interesting part...
A year ago, banks were sitting on 8,652 homes in the four counties of the South Bay and East Bay. Last month, that had dropped to about 6,200.
"Everyone keeps looking for this wave, the illusive "shadow inventory," Lenahan of ForeclosureRadar said. "Everyone thinks the banks are sitting on these huge numbers of properties. The bottom line is, it doesn't exist," she said.
"We continue to see bank owned inventories declining. We see delinquencies declining, foreclosures flat. There are no tsunami warning signs going off."
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I don't see anything damning in there, but then again I have never expected a foreclosure tsunami in the SFBA. The article says that foreclosure sales are down YoY, but up 25% MoM in Santa Clara. Your original post sort of reads like a troll post. If it isn't, my apologies.
I think that NoDs are down this year because of the tighter inventory driving prices up. Underwater folks may think that they will get back above water & are continuing to pay their mortgages, and also expecting some sort of government free money / refi programs. I think that foreclosures will remain higher than the historical norm for years to come. No wave or tsunami, but a higher rate than was historically normal as this dysfunctional RE market continues to correct.
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wave9x says
8,652 down to 6,200 is by far "no shadow inventory"... according to my math, down 25% doesn't equal "none"..
Any chance there are less foreclosures because more houses are being sold via "short sale" before they actually get to the true foreclosure REO stage??
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Call it Crazy says
Seriously? SERIOUSLY?????
The ENTIRE cabal of patnet real estate bears have ONE last hope. ONE prayer that the crash will resume, and that is that somewhere somehow there is a shadow inventory with millions of properties ready to be released into the market.
If the East and South Bay are representative of the rest of the state or even the rest of the country, and banks liquidated 25% of their holdings in a screaming bull market with bidding wars and horrible inventory numbers then what makes you think the other 75% is going to move the market lower?
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iwog says
http://en.wikipedia.org/wiki/United_States_fiscal_cliff
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iwog says
Sorry, sweetheart.... you might be seeing this HUGE bull market and bidding war in your little duck pond, but it's not anywhere close to that in other parts of the country...
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iwog says
Go back up and read the title of this thread...... "There is NO shadow inventory"
Based on California math, I guess being down 25% equals none????
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call it lazy to think... there was NEVER a time in history with no foreclosures... EVER, even during the bull years.
So dropping numbers of bank owned homes indicates a crisis ending, and is the antithesis of your and many other people's argument on here...
Now suddenly it is the fiscal cliff? what about the 2300 computer issue?
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robertoaribas says
So then go back and answer the question that I posted above:
Is the drop in bank owned home sales because more are being sold pre-foreclosure as a Short Sale before the bank actually takes it back??? If so, wouldn't this actually drop the number of REO's (like the numbers shown above)??
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Another question:
What is your definition of a house that has had a Lis Pendens filed in the town/county, it's empty and the owners don't live in it anymore, but it has never been listed on the MLS for sale?
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.... two items in the most recent quarterly 10-Q SEC filing from Fannie Mae opens the possibility that lenders may be intentionally holding back REO inventory from being listed.
The first item is found in the list of reasons that Fannie gives for only 22 percent of its REO inventory being listed for sale: Other, accounting for 5 percent of the total 78 percent that are not listed......
http://www.realtytrac.com/content/news-and-opinion/bank-owned-homes-not-listed-for-sale-7334
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Cheeseus Sonofdog says
Interesting article...... I think it definitely relates to what I am seeing on the ground in my area....
I find it hard to believe that all the shadow houses have been bought up in CA and Phoenix and there is just no inventory to be had in these areas.
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robertoaribas says
Actually, there is a Y2038 problem.
http://en.wikipedia.org/wiki/Year_2038_problem
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robertoaribas says
"fiscal cliff" is my appreciation that the past 2-3 years have been courtesy of budgetary bullshit.
And it's within the Republicans' power to put an end to the bullshit.
http://www.csmonitor.com/USA/Justice/2012/0716/Patty-Murray-Democrats-will-go-over-fiscal-cliff-unless-GOP-relents
I think the return to the Clinton tax rates for all is perfectly fine.
As is the return of 6.2% FICA.
Gonna be a kick in the balls to the economy, but it's good medicine for the long run.
And at the state level, we've got a lot of medicine to take too -- a lot of budgetary bullshit to undo.
That's the "Fiscal Cliff".
Maybe the Republicans will blink and throw their tea party contingent under the bus.
Wouldn't bet on it, which is why I am Out Of The Market.
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I'm shorting AAPL tomorrow. Real money too.
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Maybe the "shadow inventory" is better nomered as the secret inventory?
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robertoaribas says
Fiscal cliff is where this market, entire states, are heading in CA and NY.
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or maybe the "shadow inventory" is better named the "Prayed for inventory"
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Seriously, Contra Costa Times, a jackal beholden to real estate interests and real estate advertising?
Such an objective source, I guess the shadow inventory is pure BS, better run and buy right away before the market appreciation gets away from you, yada yada yada, better jump, stampede to your friendly local real estate agent and beg him for his tender mercies.
If economic basics do not support the market, then reversion to the mean, sooner or later, is the inevitable course. A dab of inflation, a dollop of higher interest rates, those temporary price increases will be in the rear view mirror. This is a manipulated market, and when the props fall out, the curves will start back down again.
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wave9x says
LOL! like someone that plastered all over THERE IS NO HOUSING BUBBLE!
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Randy H says
whats UNIX ? (im just kidding!)
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Think what you want about the Contra Costa Times, but this was not an op-ed piece. The interesting part is what ForeclosureRadar said. It is in FR's interest to promote a "shadow inventory" so people will sign up for their service. Instead they say the opposite, that the number of bank owned properties is dwindling. Are you now going to claim that FR is also a jackal beholden to the real estate industry, rather than address the numbers and facts?
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Just noticed this is from the SJ Mercury News, rerun by the CC Times. Educate me, is the SJ Mercury News also a jackal beholden to th RE industry?
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I can drive through a prospective neighborhood and see that 30 houses are for sale or foreclosed, yet only 10-15 appear on the web as for sale. If those other houses aren't in the shadow inventory, then where are they?
What about all the people behind on their payments? The people just waiting to sell if prices would rise just a tiny bit more?
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StoutFiles says
It depends on what you mean by shadow inventory. There are well documented statistics of 30/60/90 days behind on payments. And actual foreclosures.
So, in my mind, there's nothing shadow about that. You can know with a pretty good degree of certainty how many foreclosures are coming down the pipeline, even if you don't know exactly when they'll hit.
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StoutFiles says
pocket listings.. which also understates stats..
"it is never advertised nor entered into a multiple listing system (MLS), or where advertising is limited for an agreed-upon period of time. In Canada, this is referred to as an "Exclusive Listing""
http://en.wikipedia.org/wiki/Pocket_listing
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tatupu70 says
I mean the definition:
A term that refers to real estate properties that are either in foreclosure and have not yet been sold or homes that owners are delaying putting on the market until prices improve.
You are right, there's nothing shadow about that, but the info is not easily available. Most buyers do not know that information; it's not like realtors are going to share it, and it's not like the big internet sites are showing it. They all want you to pay money for foreclosure info.
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wave9x says
Actually, I think that the SJ Murky News is the worse of the two. They have been running pieces about how housing is "back" and how rents are up & experts say to buy for a number of weeks. While the main points are not disagreeable per-se, the articles read like NAr bulletins. I'd say that what I have seen in the CC times has generally been pretty objective in the past (some here may be ignoring this). They ran many pieces about how Central Valley cities are being devastated by foreclosures. Them running a SJMN piece...they are really slumming it these days lol.
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yes, certainly the SJMN are jackals... they proved it when they ran a 4 piece article stating that the inflated prices UP over 100% by 2001-02 were justified ... and have not retracted those same comments since! They simply are not journalists.
Next time... check the bios of the writers .. they have only been in the Bay Area for the past 10-12 years. The big events since dot.com , housing bubble, or the idiotic FaceBook (splat) IPO are all been overhyped by SJMN as ifs normal... I dont think these writers really understand what normal around here is.
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I don't think that MOST people understand what "normal" is around here. Then again, for how long do things need to be abnormal until they become the new normal? It's been silly here for well over a decade now, and a lot has fundamentally changed here. Who's to say that it will go back to that? The people that "built" this area in the normal times that we remember are somewhere between retiring and dying. They have been replaced by millions of transplants that don't know anything of this area beyond, "good jobs here, make money, work more and make more money, you don't have enough money work harder, buy a nice car, buy a house, get more money work more."
What we need is a good repeat of 1989. Maybe that will shake things out a little.
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bmwman91 says
Which part of 1989, the earthquake, the recession or the fall of east European communism?
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Mostly the earthquake. I was 5 and standing on a giant toy dumptruck in the front yard...that shit was FUN.
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bmwman91 says
I was *ahem* a bit older and watching waves in our swimming pool large enough to surf on. OK maybe that a bit of an exaggeration but damn it was fun!
Still had I been one of those homeowners who's house was wrecked and not covered by insurance I would have felt very differently.
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I dunno dude, the deductibles on earthquake policies are like $50k. It's almost a "why bother" situation. But yeah, glad your house didn't get wrecked. All my parents lost was a monochrome PC monitor.
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With interest rates like this, housing will be bought by investors, speculators, and savers. Still, for single guy like me who can handle living in crappy apartments, it's senseless to buy anything RE. Property management will become the next hot thing, just like credit collectors did. It's all about creating a service industry behind all this crap, inflating the market overall, and that's the policy of the fed.
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New renter says
neither anyone of these created the recession for our local SF south bay economy.
The Japanese pretty much wiped us out with their practice of dumping products below production costs on the US market. Not to mention coping products ignoring our IP rights. That is why we dont have much mfg in Silicon valley. And there was a trickle effect which hit many other non-semi tech companies, except software. Our SV software companies were pretty much left to Microsoft to feast on.. and MSFT feasted well as many SV Software companies wiped out. You do recall the Govt going after MSFT in the mid - late 90s?
http://semimd.com/lammers/2012/02/27/japan%E2%80%99s-dram-makers/
Today, as seen by the Apple - Samsung law suites... Koreans are the ones practicing dumping/coping products on world markets, thus keeping US mfg our of the market.
Earthquake had little impact on our economy! USSR was much later in 1991-92 when we were already deep in a recession.
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bmwman91 says
a sober reason not to see highly inflated homes near earthquake zones...
and if it comes to that.. there wont be any insurance to cover the all damages..
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bmwman91 says
That's my point. Few people get the insurance as it tends to be very expensive and covers little. Unfortunately homeowners insurance does not cover damage caused by an earthquake.
thomaswong.1986 says
We have two faults the Hayward and the Calaveras here in the SFBA overdue to deliver an 8.0 or greater. That's at least 10x more energy than the '89 quake. The impact on our economy depends on the damage. How well do you think SFBA business will fare if the bridges, BART and overpasses are heavily damaged, gas and electrical lines lines rupture, the Chevron refinery is wrecked (think of the recent spike in prices just due to the fire). Then add damage to residential and commercial RE. How likely are YOU to go to work if your house is badly damaged?
Remember the '89 quake happened during the world series in which the Oakland A's were playing the SF Giants. Lots of BA families were at home watching the game, NOT driving home from work as they would normally have been at that time of day. Many more people would likely have been pancaked on the Nimitz freeway:
http://en.wikipedia.org/wiki/1989_Loma_Prieta_earthquake
It could have been much worse!
The Berlin Wall fell in 1989. That was the beginning of the end for communism.