Shadow Inventory is all the houses that banks gave foreclose on over the past 5 years.Most bank have a life span of 5 years they can hold onto a property before they have too put it back on the market. Banks normally put houses back on the market through REO or they work with private investors that buy notes or they have sometimes they have to wait over times to do charge-offs because they are too deep or they owe too much on the house so to make it favorable and that the bank can make a profit they have to do charge-offs over so much a quarter until they can put it back on the market that is favorable in the bank can make a profit when they release it as an REO or a non performing note. If you are living in one of the 10 most hottest metropolitan areas in the United States and you are finding that inventory is short truly it is right now very very scarce. You will see most of the developers throughout the United States and opportunity zones or a lot of builders are going to I mean a lot's of developers are going to basically going to start building and if you are developer and want too start building. I would recommend that outfit build for the city because only 25% of your inventory can be used for affordable housing and the other 75% can be in a profit performance state where that you can make a profit off of it. To learn more about Shadow inventory start going to local banks in your area and ask for asset managers or people who are running all of the bank's portfolio and basically try to start a relationship with them and see if they can hand you out non-performing notes and remember if you do buy a non-performing note that's all it is to know it has nothing to do with the ownership of the property the note and the property is two separate entities. On Tuesday I will write another blog about non-performing notes the do's and the dumps and buying notes and also how to make a better relationship with your local assets managers or portfolio managers in your neighborhood.
top of page
bottom of page