Foreclosures RisingThe latest development on the “shadow inventory” front concerns a backlog of properties in judicial foreclosure states, according to the New York Fed. HousingWire reports this morning:

Judicial states maintained higher foreclosure rates in early 2013, indicating the length of a loan remains in the foreclosure process in the judicial states is significantly longer than in the non-judicial states. […] As a result, the large volume of loans in the foreclosure process in the judicial states appears to be impeding a home price recovery in those states.

The judicial foreclosure states have seen a more modest improvement in home prices since the trough for a given peak-to-trough decline in home prices.

“One potential explanation for this relationship is that potential homebuyers in the judicial states recognize that a large number of distressed sales have yet to occur, and this consideration has influenced the prices they are willing to offer for homes currently on the market,” the NY Fed analysts concluded.

Stay tuned here to see how these properties might affect the real estate market near you… and contact me today with questions about the latest on REOs in the Sacramento region.

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