Shadow inventory: Why it’s not as scary as It looks

It is estimated that there are 3.25 million mortgages that are at least three months past due or in foreclosure as of May. This number is down from last year and down from it’s peak of 4.25 million in 2010. (Source: Barclays Capital) Unless mortgage delinquencies begin to accelerate sharply, the shadow inventory won’t be growing, the Wall Street Journal reports.

“The concept of a huge shadow inventory is preposterous,” says Christopher Thornberg, a housing economist with Beacon Economics in Los Angeles. “The number of mortgages in distress is way down from one year ago. It’s clear there are fewer distressed properties out there.”

Read part one of a three-part series examining shadow inventory from the Wall Street Journal.

In other news:

Chicago Alderman says city should consider seizing ‘underwater’ homes. – Chicago Sun Times

Retail sales climb for 1st time in 4 months – CNN

Once and for All, which way are home prices headed? You must take into consideration three things in order to help determine where prices are headed. – The KCM Blog

Thirty-three percent of houses sold in one month time period – This according to the latest REALTORS® Confidence Index report (RCI) – NAR Research