Morning Minute: More on shadow inventory

Yesterday the Wall Street Journal published part two in their series examining shadow inventory. While there were 3.25 million loans that were in the foreclosure process or in default at the end of May, banks owned around 407,000 homes at the end of May, according to estimates.

What’s more worrisome than the actual “shadow inventory” is how banks dispose of it—and whether there are enough buyers willing to purchase the homes when they do.

How does low new construction help the outlook? Read today’s part 3 in the Wall Street Journal.

…there’s been comparatively less attention on the lack of new housing construction, which has helped to offset the potential damage from elevated levels of foreclosed properties. New home building has been at its lowest levels since World War II in 2009, 2010, and 2011.



One thought on “Morning Minute: More on shadow inventory

  1. While I was always a big fan of the book “Everything I needed to know I learned in Kindergarten”, I find it a bit troubling the most sophisticated financial news organization in this country looks at the housing market with this simplistic view.
    Not sure if I should laugh or cry knowing policymakers look to them for information.

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