by Calculated Risk on 8/14/2008 10:08:00 AM

Sacramento Real Estate Statistics has some excerpts from a Deutsche Bank research report by research analyst Nishu Sood: "An inventory overhang builds in the shadows" (no link)

Peter Viles at the LA Times covers the story: Bank sees huge "shadow inventory" of foreclosed houses

This is interesting data, and worth reading the excerpts. In the report, Sood argues: "MLS listings do not fully reflect distressed inventory." and then he provides some tables (see the above link).

But it's not as bad as it first seems. I've chatted with Max at Sacramento Real Estate Statistics (thanks Max!), and in the notes, Nishu Sood writes:

Source: Realtytrac, Housingtracker, Deutsche Bank
Note: Foreclosure inventory includes pre-foreclosures, auctions and REO. 2/3 of pre-foreclosures are assumed to become foreclosures.

So these are not all REOs; in fact most of these homes are probably in the foreclosure process.

Yes, Sood makes a good point - there are many homes not listed that are probably future foreclosures. And I'd add, there are many homeowners waiting for a "better market" to list their homes. So inventory will probably stay elevated for some time.

But, just to be clear, Sood's stats are not unlisted REOs held by some bank in the shadows.