The nation’s shadow inventory, a measure of potential supply that is not yet counted in the inventory of homes for sale, continued to shrink. One metric that is the main driver of shadow inventory improved most in Arizona.
The number of homes in the shadow inventory totaled 2.2 million in January. The inventory includes properties with loans that are seriously delinquent, in foreclosure and held as real-estate-owned assets by servicers. Properties listed on multiple listing services are excluded.
The pending supply as of January was down from 2.6 million properties three months earlier and also a year earlier.
CoreLogic, which utilizes its loan performance servicing and securities databases to come up with its findings, said the shadow inventory peaked in January 2010 at 3 million homes.
Based on the property values, the shadow inventory was $350 billion in January, lower than $376 billion in the previous report and down from $402 billion a year earlier.
January’s inventory level represented a nine-month supply, worsening from a seven-month supply in October.
CoreLogic said the shadow inventory represented 85 percent of the 2.6 million properties that are seriously delinquent.
“The shadow inventory continued to drop at double the rate in January from prior-year levels,” CoreLogic President and Chief Executive Officer Anand Nallathambi said in the report. “At this point in the recovery, we are seeing healthy reductions across much of the nation.”
Distressed properties in Florida accounted for 16 percent of the national total, while 44 percent of all distressed properties were either in Florida, California, New York, Illinois or New Jersey.
The main driver of shadow inventory, serious delinquency, was down 40 percent over the past year in Arizona — more than any other state. California’s 90-day rate was a third lower, while Colorado’s rate was down 27 percent, Michigan improved by a quarter and Wyoming was 23 percent better.
