Duplex Shadow Inventory Falls From 2010 High

According to CoreLogic, as of April, less than 2 million homes, duplexes, triplexes remain in shadow inventory.

That’s down 18 percent from the total amount of shadow inventory on the books last year, and 34 percent lower than the 3 million in April of 2010.

Shadow inventory consists of properties not on the market, where the seller is seriously delinquent on mortgage payments, or in some state of foreclosure.

Most of the shadow inventory out there are those delinquencies, which total 1,651,000 properties.  Nationally, there less than 2.3 million property owners who are at least 90 days past due on their mortgages.

What this ultimately means to duplex investors is while there are still a large number of properties yet to move through the foreclosure process to become REO’s (bank owned), the market is shrinking, meaning prices are probably headed up for the long haul.

For sellers, this is good news. With fewer bargain-priced properties to choose from, prices are likely to stabilize. However, if you’re thinking of selling, it will remain important to keep an eye on rising interest rates and their impact on affordability.