MIAMI – Oct. 17, 2011 – Officially, there are 3.5 million homes for sale nationwide. But there are millions more lurking in the shadows – hidden neatly away on banks’ balance sheets, stalled in foreclosure court proceedings, or simply occupied by nonpaying owners as lenders wait months or years before taking action.
The housing market’s ballooning shadow inventory – buoyed by a yearlong foreclosure slowdown – stands as its most menacing problem, threatening to stifle recovery for several years.
And South Florida, with some 200,000 homes either already owned by lenders or headed for foreclosure, has one of the nation’s largest collections of unseen inventory. The number of shadow homes dwarfs the 30,000 or so that are listed on the active market. Even as prices have shown signs of stability this year, an impending wave of foreclosures threatens to keep real estate values deflated in South Florida and across the country.