Shadow Inventory

DSNews.com – Although the Obama administration has worked to suppress foreclosures, it appears these efforts may not be enough, according to Bank Foreclosures Sale, a foreclosure listing service.

High unemployment continues to plague the real estate market, and according to a recent article in the New York Times, an estimated 2.4 million foreclosed homes will be added to the list of 2010 foreclosures. As a result, Bank Foreclosures Sale predicts prices will decrease another 10 percent.

Simon Campbell, a real estate analyst for the company, said it appears the real estate market may see a surge of shadow inventory properties appear on the market. These are properties that have not been calculated into official inventory numbers and include homes repossessed by lenders through foreclosures and similar actions and homes where owners are 90 days or more delinquent on payments.

Unemployment remains at a record high, and congressional leaders continue to look for ways that millions of people who have lost their jobs will be able to stay in their homes. While current statistics show lenders may finally be closer to finding a solution for the home mortgage crisis, Campbell said the question now is about how fast these lenders can work to stem potential foreclosures.

“Until we see a reduction in the number of foreclosures, we cannot get too hopeful about restoring housing industry stability,” Campbell said.