With the MSM still peppering us about the size of the shadow inventory, Ed asked today for a summary of the local SFR backlog of defaulters.
Included on the right side is the total number of detached MLS sales over the last 12 months so you can gauge how many years it might take to clear out the shadow:
| Town or Area | Zip Code | NOD | NOT | MLS sales, last 12 months |
| Cardiff | 92007 | 6 | 19 | |
| Carlsbad NW | 92008 | 24 | 42 | |
| Carlsbad SE | 92009 | 60 | 94 | |
| Carlsbad | 92010 | 22 | 32 | |
| Carlsbad SW | 92011 | 21 | 34 | |
| Del Mar | 92014 | 19 | 26 | |
| Encinitas | 92024 | 56 | 72 | |
| La Jolla | 92037 | 29 | 39 | |
| RSF | 67+91 | 16 | 37 | |
| Solana Bch | 92075 | 13 | 26 | |
| Carmel Vly | 92130 | 33 | 60 | |
| Totals | NSDCC | 299 | 481 |
We’ll expect that a couple of these folks will get their loan mod, a few others will get their yearly bonus, gift or inheritance to get current, and some will get gifts from the FedGov – see below.
P.S. For comparison, during the previous 12 months, there were 2,541 SFR sales on the MLS, while the tax credit was in full swing.
From HW:
The Federal Reserve’s policy of keeping interest rates low to spur lending hit a barrier in the recovery with home prices falling and underwriting guidelines keeping borrowers from refinancing, said Eric Rosengren, president of the Federal Reserve Bank of Boston.
With that in mind, the Fed Bank CEO said he supports policies that would allow homeowners who are underwater on their mortgages to refinance their loans. “Clearly getting more money into the hands of homeowners who spend it could help to fuel GDP growth,” he said. “This would reduce one of the impediments to a more significant effect from the monetary policy actions taken to date.”
http://www.signonsandiego.com/news/2011/sep/28/u-t-unveils-papers-first-real-estate-panel/
I saw in the comment area for the last post that JTR was not added to this panel. I’ll be curious to see if his perspective is represented by someone else or if it will only be a group of Realtor cheerleaders with unrealistic expectations.
SDTeacher:
Looking at the article you provided, the latter (cheerleaders) would seem to be a safe bet.
The first three of the experts provided virtually nothing of substance in this article…not much hope there!
While the hidden market of distressed homes has yet to fully make its way to multiple listing services, its estimated size continues to fall, according to a new report from CoreLogic (NYSE: CLGX).
As of July 2011, the size of the national supply declined to 1.6 million units, representing a supply of five months. During the year-ago month the supply stood at 1.9 million units, or a six-month supply.
In CoreLogic’s most recent previous survey, during April 2011, the inventory stood at 1.7 million units.
The company estimates shadow inventory supply by calculating the number of properties not listed on multiple listing services that are delinquent 90 days or more, in foreclosure or real estate owned.
The decline in the size of the shadow inventory is being driven by a pace of new delinquencies that is slower than the disposition pace of the various forms of distressed properties.
Data at the state and county levels from CoreLogic are not available, but numbers from the County Assessor’s office show that one element of the equation, new delinquencies, are declining precipitously on a year-over-year basis.
Through August of this year, 14,570 San Diego households received notices of default, establishing that they were arrears on their mortgage payment.
That’s a decline of 13 percent from the 16,849 filed during the year-ago period, and down 48 percent from the 28,149 from the same period in 2009.
Mark Goldman, lecturer at the Corky McMillin Center for Real Estate at San Diego State University, said there had been widespread industry expectation that the size of the shadow inventory would start trending downward in 2011 and 2012.
“It makes sense because there was a big bulge going through the snake, with homeowners deleveraging lots of real estate as well as other assets,” he said. “The number isn’t going to work through rapidly though. We’ll have shadow inventory for another two, three, maybe four years, but we’re past the worst of it.”
At the current pace, the shadow inventory wouldn’t be resolved for another five years.
The pace could accelerate as economic conditions improve and fewer households are forced into delinquency while more participate in the trade-up market, with banks reacting to the lack of new distressed assets by writing down those currently hidden from their balance sheets more aggressively.
But Goldman stressed that there’s going to continue to be a steady stream of new defaults as long as weakness remains in the labor market.
Still, he said the most vulnerable mortgage holders to default are those who lack equity, and the majority of homes purchased in the market run-up have already reached the shadow inventory. It’s those underwater homeowners who have held on as the values of their homes have plummeted that continue to present pronounced risk of default.
Of the 1.6 million properties currently in the shadow inventory, 770,000 units are seriously delinquent (2.2 months of supply), 430,000 are in some stage of foreclosure (1.2 months of supply), and 390,000 are real estate owned (1.1 months of supply).
The total of the shadow and traditional housing inventories is 5.4 million units, down from 6.1 million a year ago, meaning the shadow inventory accounts for 29 percent of the total housing inventory.
“The steady improvement in the shadow inventory is a positive development for the housing market,” said Mark Fleming, chief economist of CoreLogic, in a release accompanying the data. “However, continued price declines, high levels of negative equity and a sluggish labor market will keep the shadow supply elevated for an extended period of time.”