How 'Shadow Inventory' Hurts the Housing Market

David, I believe Staiger is very wrong. The shadow inventory continues to drop as well as the rest of the inventory, I work in real estate every day and follow the local, state and antional numbers religiously. Price is started to head up in many areas and this will allow more folks to sell without the big loses people saw earlier in this market. The no-money down thing is problematic, but the quality of loans has greatly increased even if the folks don't have as much down. Also remember, the great majority of the shadow inventory is not in the banks' hands, they may "control" 25% of it. As far as prices and interest rates going up, that will spur buyers to get off the fence and buy. People buy out of fear in many cases, people don't generally make good economic decisions. Look at 2005-2007, people saw prices and rates go up and were scared they would have to pay more later, so they bought then. Look at 2008-2011, people slowed their consumption of real estate while everything was on sale. Don't take my word, look at all the history of these trends. You guys have a good day.

Don of FL 11:37AM June 06, 2012