The latest October sales numbers were flat and the months supply is still elevated as the hangover of the home sale tax-credit lingers. Despite the tax-credit moving some housing inventory off the market this past year, the inventory continues to grow.
In the graph based on data from CoreLogic, the dark blue area represents the roughly 4 million homes that are officially for sale. The growth in the other colored lines indicates that there are now an additional 2.1 million homes that are in delinquency, foreclosure or REO status.
In the coming year, some analysts are expecting that the shadow inventory of homes will drag down the median home sales price before it stabilizes in the second half of next year. By that time, the hope is that the U.S. economy will regain its legs and the housing market will have cleared out some of its excess inventory – allowing home prices to stabilize.
The Housing and Mortgage Market Trend Sheet, located in the "OCE Documents of Interest" column at the right, is now updated with October figures. The trend sheet includes sales, pricing, construction, underwriting and delinquency data.