Shadow Inventory Quickly Evaporating

There were a total of 43,000 completed foreclosure in February, CoreLogicrnsaid today.  This was 15 percent fewerrnthan in February 2013 when foreclosures numbered 51,000.  It was also 7,000 fewer foreclosures than inrnJanuary 2014, a decrease of 13.1 percent. The company said that since thernfinancial crisis began in September 2008, there have been approximately 4.9rnmillion completed foreclosures nationally. rn </p

Nearly half of all completed foreclosures in the U.S. over the 12 monthrnperiod that ended in February were in five states.  Florida reported 118,000 foreclosures,rnMichigan 50,000, Texas 39,000, California 37,000, and Georgia 34,000.  </p

While completed foreclosures, the foreclosure inventory, and seriouslyrndelinquencies all showed notable improvements, the big news in CoreLogic’s Februaryrn2014 National Foreclosure report was from its quarterly supplement on shadowrninventory data.   Shadow inventory or thern”pending supply” is calculated from the number of properties that are seriouslyrndelinquent, in foreclosure, or held as owned real estate (REO) by lenders butrnnot currently listed for sale through Multiple Listing Services.  Throughout the housing crisis the shadowrninventory has been viewed at the “next shoe” that could drop and impede recovery.   That threat seems to be rapidly disappearing.  CoreLogic estimates that the nationalrnresidential shadow inventory stood at 1.7 million homes in January, down 23rnpercent from the estimated inventory of 2.2 million in January 2013. </p

The dollar value of the shadow inventory inrnJanuary was $254 billion compared to $324 billion in January 2013 and $289rnbillion in July 2013.  CoreLogic saidrnthat from January 2013 to January 2014 the inventory had been decreasing at anrnaverage monthly rate of 41,000 units.</p

“Although there is good news that completed foreclosures are trending lower,rnthe bigger news is the impressive decline in the foreclosure and shadowrninventories,” said Dr. Mark Fleming, chief economist for CoreLogic. “Everyrnstate has had double-digit, year-over-year declines in foreclosure inventory,rnwhich is reflected in the $70 billion decline in the shadow inventory.” </p

CoreLogic said that there were 752,000 homes in some stage of foreclosurernin in February.  This foreclosurerninventory has declined from 1.2 million in February 2013, a year-over-yearrndecrease of 35 percent.  The inventoryrnwas down 3.3 percent from January to February. rnThe foreclosure inventory in February represented 1.9 percent of allrnmortgaged homes in the U.S.  One yearrnearlier the inventory represented 2.9 percent of mortgaged homes.   </p

The five states with the highest foreclosure inventory as a percentagernof all mortgaged homes as of February 2014 were New Jersey (6.2 percent),rnFlorida (6.0 percent), New York (4.7 percent), Maine (3.4 percent) andrnConnecticut (3.2 percent). </p

At the end of February 2014, there were 1.9 million mortgages, or 4.9rnpercent, in serious delinquency, defined as 90 days or more past due, includingrnthose loans in foreclosure or real estate owned (REO).  In the 12 months ended in January every staternsaw a double digit decrease in the number of seriously delinquent loans.  Twenty-four states had decrease of at leastrn20 percent.</p

“The stock of seriously delinquent homes and the foreclosure rate arernback to levels last seen in the final quarter of 2008,” said Anand Nallathambi,rnpresident and CEO of CoreLogic. “The shadow inventory has also declined year overrnyear for the past 3 years as the housing market continues to heal, includingrndouble-digit declines for the past 16 consecutive months.”

All Content Copyright © 2003 – 2009 Brown House Media, Inc. All Rights Reserved.nReproduction in any form without permission of MortgageNewsDaily.com is prohibited.