The talk around the Real Estate industry for months has been about shadow inventory. This is inventory of unsold homes that has been kept from the market for several reasons, mostly because banks do not have the resources to handle all of the foreclosures. Information I gleaned from Zillow and RealtyTrac show that the Alameda Real Estate Market may have some hidden inventory.
Zillow is reporting that a big group of homeowners have been trying to wait out the downturn in the market and are ready to sell. “Almost one-third of homeowners (31 percent) said they would be at least somewhat likely to put their homes on the market in the next 12 months if they saw signs of a recovering real estate market,” according to Zillow’s first quarter Homeowner Confidence Survey. “Maybe these homeowners have outgrown their homes, or are dreaming about living in a new neighborhood or town, but don’t like the prospect of selling in the current market.”
The shadow inventory can result in a slower recover.
“This “shadow inventory” will likely be one of the contributors to a recovery that is more “L”-shaped than “V”-shaped. As sales rise and inventory is cleared off, many homeowners will start to test the waters again by putting their homes on the market, thus keeping supply levels higher than they would be without this pent-up inventory. These sustained supply levels will serve to keep downward pressure on prices, which can only increase as demand begins to outstrip supply,” wrote Zillow’s Vice President of Data and Analytics Stan Humphries.
Over at RealtyTrac, a search of foreclosures for Alameda show that there is a looming group of homes ready to hit the Island’s Real Estate market. The Website list 93 homes in Pre-foreclosure. The owners have received notice of default, but have not yet been foreclosed.
The Pre-foreclosed homes is more than half of what is currently listed on the Multiple Listing Service (MLS). Add to that 53 listed for Auction and another 75 Banked-Owned and that is 221 properties that could add to the rise in inventory.
The MLS shows eight foreclosures and 21 short sales listed. If we subtract that out of the Realty Trac numbers that leaves a 192 properties that have yet to hit the open market.
Alameda Inventory as of Sunday May 17, 2009
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Zillow Report http://www.zillow.com/blog/when-the-bottom-arrives-a-flood-of-shadow-inventory/2009/05/19/
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