U.S. shadow inventory still at 2009 levels

Shadow inventory nationwide remained at 1.6 million units through
October 2011, approximately the same level as in January 2009, according
to a report from CoreLogic. Florida, California and Illinois accounted
for more than a third of the shadow inventory across the United States,
with the top six states accounting for about half of all shadow
inventory. There have been approximately 3 million distressed sales
since 2009, when home prices were declining at their fastest rate. “The
shadow inventory overhang is a large impediment to the improvement in
the housing market, because it puts downward pressure on home prices,
which hurts home sales and building activity while encouraging strategic
defaults,” said Mark Fleming, chief economist for CoreLogic. — Alexander Britell