The long predicted tsaumi of forecloses is not forthcoming. This, is according to Rick Sharga, SVPof Realty Trac. According to Rick, the bank will release the 'shadow inventory' to the market over the next couple of years in a controlled fashion.**
Our own Carlos Silva predicted the same in an article last August. see link
This way only makes sense, because if the banks were to flood the market with all of their pent up inventory it would apply downward pressure on pricing. In turn, further exacerbating the depressed housing market and home prices.
The 'shadow inventory' exists but the 'tsaumi' apears to not be heading our way........
**From NFSTI conference on 2/25/10 sponsored by Dan Waterman
Comments
On my point about agents leaving, Steve, I do know some good ones have gone. Fortunately, so have a lot of bad ones. There are always bad agents out there, and they'll never be all gone, but hopefully the majority of the ones leaving now will not be missed.
Megan, the biggest problem with agents leaving is it's the good ones. The bad ones seam to be growing in numbers! I've got one agent that has been trying to get one of my listing under contract since Christmas! I've lost count on how many times I've sent his offers back for corrections. Now we have an agreement with the bank and he still cannot get the paperwork correct so we can make it binding!
And yes Shelly, I see the numbers in my area outside Atlanta. Thousands of homes somewhere in the foreclosure process, but none coming on the market. I've already been told of 100 to 130 properties coming my way, but the asset manager has no idea when the bank will release them. All we can do at this point is wait and ride it out the best we can.
Megan Zavieh
Mission Valley Real Estate Company
Fremont, California
Pricing has not been affected yet except for when we get competing offers, otherwise buyers still want to cut your throat on each deal. Even with new construction REO's going for $100K off builder's pricing, people still think they can offer 30% below list price and get upset when we counter back. Now if I could add the word "Foreclosure" to our regular listings they would be gone. All people want to look at in my area are foreclosures, but they don't understand thay are dealing with banks and not a normal home seller.
Yes, I agree with yall. Limited inventory will slowly bring up pricing. But at the rate agents are leaving the business right now due to no sales (which will be good for me if I can hang in there), there may not be anyone left to conduct the sale! And it's hard to pay your bills when you have run out of inventory and you do not know when more are coming.
Steve I do understand what your going through in your market, down here in SW Florida we are at a 5 month supply of inventory now verses a 28 month supply last year, properties were cherry picked and the quality went down with the supply, now when I get an REO they go under contract almost immediately.
Hopefully because the lack of inventory in Atlanta your pricing will increase quickly and you can start selling those builders homes your waiting on, might even do well for your lots too. Record lows mean aggressive buyers, hopefully the banks will continue to give you properties as they realize your area trends.
There will always be REO, the smart REO agents will continually seek to improve their market share. I personally feared the tsunami and didn't want to be sitting on 80 listings with no buyers as well as every other broker in the area. It is a very smart move on the banks part to proteck and preserve.