U.S. Housing Inventory

I lot of optimism on housing inventory backlog coming down to  7 months supply. A view from David Rosenberg of Gluskin Sheff + Associates:

So, while this data may well show that the inventory backlog has come down to what seems to be a respectable 7 months’ supply, we also know from the U.S. Census data that there are around 3½ million homeownership units that are currently being taken off the market for unstated reasons. (We reckon that this is a pretty good proxy for the ‘shadow’ foreclosed inventory at the banks). In other words, we very likely have the inventory backlog at closer to 14 months’ supply and this is why prices are still declining. At the margin, there are still many more sellers than there are buyers.

I completely agree that the shadow inventory is a key factor here.


This entry was posted on Friday, November 27th, 2009 at 6:01 am and is filed under Markets, U.S. Housing. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

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