A 'bank owned' sign hangs in front of a foreclosed home in Miami… (Joe Raedle / Getty Images…)
The number of distressed properties that may soon hit the market declined in January, according to a new report.
The nation’s so-called shadow inventory fell to 2.2 million units in January, an 18% drop from the same month a year earlier, real estate data provider CoreLogic said Tuesday. That represents a supply of nine months.
The Irvine firm calculates pending supply by estimating the number of homes that are in the foreclosure process, are owned by lenders or have seriously delinquent loans.
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Shadow inventory has dropped 28% since it peaked at 3 million homes in January 2010.
Tight inventory has played a major role in driving up home prices lately as traditional home buyers and investors seek out few available homes. Shadow inventory provides a look into how many distressed homes could be put up for sale.
“The shadow inventory continued to drop at double the rate in January from prior-year levels. At this point in the recovery, we are seeing healthy reductions across much of the nation,” CoreLogic Chief Executive Anand Nallathambi said in a statement.
Nallathambi said five states — Florida, New York, California, Illinois and New Jersey — account for nearly half of the nation’s shadow inventory.
California saw its supply of serious delinquencies — homes with a loan 90 days or more past due — fall 33% over the year. That was the second-largest decline behind Arizona.
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