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Foreclosed and Repossessed Houses Set to Increase in the Next Two Years

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By : John Cutts    99 or more times read
The number of repossessed houses and foreclosed properties will increase further in the coming two years, according to housing market analysts. The prediction was based on estimates that several states in the U.S. are currently sitting on shadow inventories of homes that are worth several years of supplies.

Locally, housing market analysts stated that the fact that New York City foreclosure listings are not as high as in other areas might not mean that the city is enjoying better housing conditions than other regions. Some of them have stated that a lot of foreclosure cases in the city and the whole state might have gotten caught in the pipeline and procedures have just been delayed.

These same analysts stated that the foreclosed home listing in New York is not showing all the properties under foreclosure in the state. Data from Standard & Poor's revealed that New York is currently holding a shadow inventory worth almost 10 years of residential property supplies. Shadow inventories are supplies of properties that are under foreclosure but have yet to enter the sales market and therefore, are not yet included in foreclosure statistics.

Some housing industry analysts also stated that unrecorded foreclosed and repossessed houses in New York comprise the biggest shadow inventory in the whole U.S. Other states believed to have huge shadow inventories are Boston, Massachusetts and Miami, Florida. S&P data estimated that Boston has around 62 months of housing supplies, while Miami has an inventory equivalent to 60 months.

Several reasons have been cited by industry experts for the growing number of homes that have yet to be included in foreclosed properties listings. According to them, there are still more than two million properties that are under some form of foreclosure in the country, but lenders have not added them to the foreclosure statistics yet mainly because the processing has taken longer than before.

In addition, lenders have been overwhelmed by the massive volume of foreclosed and repossessed houses that they are unable to work through the supplies quickly, causing a backlog in the procedure and a higher level of shadow inventories. S&P reported that among the 20 markets tracked; only Miami did not record an increase in shadow inventory during the January-September 2010 period.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.

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