A shadow inventory of foreclosed homes that are “off the books” is lowering home prices and hurting realtors.
Real estate brokers are becoming frustrated and suspicious of bank-owned homes showing up for sale out of something they call the shadow inventory.
The shadow inventory is housing that has not yet reached the market, but inevitably will, such as homes owned by banks after foreclosure.
After listing a modest Portland home for $175,000 in a neighborhood with no other homes for sale, Keller Williams principal broker Nick Krautter thought he might have an easy sale. But only days later, a bank-owned sign popped up in front of an almost-identical house next door with a price of $100,000…
“There are two homes owned by (banks) to every home that is actually listed by them,” Krautter said. “There are lots of theories on why it is taking so long for these homes to get to the market, and whether it’s purposeful or not, people need to be more aware that it’s affecting the market.”
Read more at the Daily Journal of Commerce.
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