New evidence revealed in the latest Tallahassee Foreclosure Report indicates that distressed properties are being processed in a more efficient manner, leading us to believe that they will soon be entering the market. As one of the leading sources for the often discussed shadow inventory, we keep a vigilant eye on the processing of foreclosures in our area.
Homes in the shadow inventory are poised to explode, entering a market that is already filled with a glut of homes for sale. For our new readers who are not up to speed on the shadow inventory, the following articles cover this very important topic in every real estate market:
We monitor lis pendens filings and foreclosure sales in Tallahassee on a weekly basis in order to monitor their effect on the housing market. We measure the number of lis pendens filed each week (the beginning of the process) and we measure the number of final foreclosure sales (the end of the foreclosure process), and then by comparing the two, we get a feel for how many homes have not yet "fixed" their situation.
We know that most lis pendens filed are a signal that the home owner is in trouble and most likely will be moving in a relatively short period of time. Only a minority of homeowners work out a long-term solution to their problems once the lis penden is filed. So the difference between the number of filings and the number of foreclosure sales represent the number of distressed properties that either need to sell through a short sale, or will be eventually added to the foreclosure side of the equation.
The following real estate graph was designed to show us the relationship between lis pendens filings and final foreclosure sales. Note the blue line (the ratio of foreclosure sales to lis pendens filings) is on a steady rise.
We believe this shows that banks are moving forward at a faster rate on foreclosures and through monitoring these sales, we know that the banks are the ones ending up with the properties after the sale. This is a sign that the segment of the shadow inventory that is comprised of foreclosed homes is growing, and we should expect to see them showing up in the supply side of our housing market.
Recent Foreclosure Reports In Tallahassee
- Lis Pendens Filings 1st Quarter 2010
- Tallahassee Foreclosure Report March 2010
- Tallahassee Lis Penden Filings Week+ Ending March 31, 2010
- Tallahassee Lis Penden Filings Week Ending March 21, 2010
- Tallahassee Lis Penden Filings Week Ending March 14, 2010
- Tallahassee Lis Penden Filings Week Ending March 7, 2010
Joe Manausa, MBA is a 26 year veteran of real estate brokerage in Tallahassee, Florida and has owned and managed his own company since 1992. He is a daily blogger with content that focuses on real estate analytics and providing his clients with a tactical advantage in today's challenging market.