CoreLogic released a report confirming that the shadow inventory of distressed properties waiting to be put on the market reached 2.1 million units at the end of August, which is up 1.9 million from one year earlier.
The report additionally noted that, with visible inventory at 4.2 million units, the total supply of unsold inventory stands at 6.3 million units, an increase of 3 percent from 6.1 million last year.
The total quantity of unsold homes was 23 months in August, up 17 months from a year ago, according to the report. Furthermore, the report noted normally a gauge of six to seven months is considered average, but the current total months’ supply is approximately three times the normal rate meaning that the market continues to be flooded by available properties.
CoreLogic chief economist Mark Fleming, said, “The weak demand for housing is significantly increasing the risk of further price declines in the housing market,” he commented. “This is being exacerbated by a significant and growing shadow inventory that is likely to persist for some time.”
The additional 2.1 million homes will eventually join the nation’s housing market as foreclosures. Individuals in demand for a home with moving plans should follow the situation closely as a recent report by Harvard and MIT found that foreclosures sell for a 27 percent discount.