This is PART I – Also read my upcoming article (PART II), where you will be able to gain access to a podcast from WOR710.com “Eye on Real Estate” with Dottie Herman, of Prudential Douglas Elliman, and Jonathan Miller, of Miller Samuel where I ask them relevant questions about this report…
“Shadow Inventory” seems to be talked about a lot right now – it is especially discussed in the New York Metropolitan Area in The Real Deal Online… Tell me folks, “Is it really time to panic?”
What is “Shadow Inventory” ? Shadow Inventory is distressed property which has not yet been factored in to or added to current market inventory. It may also be defined as units that are part of new development which are also not factored into the inventory.
Distressed Property, as defined in BusinessDictionary.com, (link), http://www.businessdictionary.com/definition/distressed-property.html , is “Property that is under foreclosure order, or is advertised for sale by its mortgagee. Distressed Property usually fetches a price that is much below market value”.
According to this Standard & Poors report, analyzed by famed real estate appraiser Jonathan Miller, of Miller Samuel, the New York Metropolitan area, (comprised of New York, Northern NJ, Long Island, NY, and Pennsylvania), is the leader in the country with 103.1 months worth of residential shadow inventory.
(Over 8 1/2 years worth of inventory and a 3.3% increase over the levels in the region at this time last year )
Now with my commentary on this subject…
The “subject region” is probably the most densly populated of all metropolitan areas of the country, which leads the reader to believe that we are doomed – Yes, it is something that needs to be watched closely, but I would like to see a breakdown of each “sub-area” of the region so we can see clearer analyses.
After all, we all know that each individual market is unique, right?
Here is a link to the article and subsequent report;
Now I need to know YOUR opinions on this topic – please write your comments below or email me at [email protected] – I truly want your feedback, as it is valuable to me !
Based on your feedback, I may write a followup to this much debated hot topic.
Thank you for reading !