patrick.net

From the above link:

"Shadow Inventory Note…I say “rolling” because “shadow inventory is not static. Most “analysis I read make no mention of this rather only talk about how quickly it will clear based on 400k monthly existing home sales. But they have their numerators and denominators all wrong. Shadow Inventory increases by the number of new “60 day lates” and “mortgage mods” granted each month — both have a 75% chance of foreclosure in 2 years — and decreases by the number of “distressed” existing home sales per month. Because there are roughly 130k 60-day lates + mods and only 110k distressed resales per NAR, shadow inventory is growing by abut 20k units per month right now."

He made a small error in his calculation. He states that 75% of loan mods and 60 day lates eventually becomes a foreclosure. So, that 130K figure needs to be mulitplied by .75. Which gives you 97,500. So the shadow inventory is actually DECREASING by 12,500 per month.

Again, why are we looking at articles that are over a year old?

Low interest rates and flippers, I see allot of these fixers/fixed on the market.