The “shadow inventory” has been a term used in the last few years to describe homes that are in foreclosure or delinquent and not yet sold or listing on the market. It has been looming over us for several years and caused much uncertainty for home sellers and buyers. Sellers have been unsure when to list their homes and buyers held off on buying because they felt the market may still drop farther.
Well for the buyers that waited – sorry to tell you but the bottom of the real estate market in Orlando has come and gone. The good news is at least you can still get record low interest rates and the affordability is still top notch!
For home sellers, now is the time to list. The inventory has declined to a level that is in line with the number of buyers and in many price ranges it is considered a seller’s market. This shift is largely due to the fact that this shadow inventory is shrinking. The number of homeowners who are delinquent on their mortgages (the delinquency rate) has dropped to 5.41% in the last quarter of 2012. Most economists expect it will continue to drop slowly in 2013. This slowing of the delinquencies lends to a little more confidence that the foreclosure gap is closing up and the market will return to some normalcy in years to come.
Don’t expect sweeping increases in values just yet. Although some neighborhoods have seen increasing values in the last few months, Florida was one of the hardest hit with foreclosures and still is one of five states making up 45% of the total number of distressed properties. Real estate is local so check with us to see if now is the right time for you to list.
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