Short Sales are here to stay..for awhile anyway!

Short Sales are here to stay....for awhile anyway. 

Just my opinion of course, but it would appear that with unemployment remaining high and the demand for housing flat, not too hard to predict.  Sales are up approx. 25% in our desert region..great news!  Inventory in particular developments in particular areas is low..hooray again!  But..we won't be seeing many new housing starts and there truly is a backlog of "shadow inventory" somewhere.  Those loans are there, we just don't see them...yet. 

I have been reading about "shadow Inventory" for several years now.  From dealing with the Lenders on the Short Sales I have been working, it still feels like they are not ready to sell these properties until they are READY.  What I mean is, if an offer comes along at the right time in a Short Sale, it moves forward and the loss is agreed upon, the deal closed, the Seller is 1099'd, and away we go.  It is much more likely, however, that the Lender may have that particular property slated to show as a "loss" at a much later date.  They are not quite ready to let the old share holders see the true value of the Lenders' assets..until a given time.  That given time is unknown to everyone except that Lender.  And so the shuffle continues.  The game of "kick the can" goes on. 

The "can" is the number of bad loans, abandoned homes, and strategic defaults hiding.  Short Sales will be around for years..better get used to them.