'Shadow' inventory of foreclosed homes could add to housing troubles

The Dallas-Fort Worth area has one of the lowest "shadow" inventories of unsold homes among major U.S. cities, according to a new study. But the addition of these houses to the market still significantly adds to the supply.

Shadow inventory homes are properties that have been foreclosed on or are in the process of foreclosure but are not currently listed for sale. Housing analysts say this pending supply will keep prices depressed in many cities.

Nationwide, there were more than 2 million shadow inventory homes in August – an eight-month supply – according to researchers at CoreLogic Inc. In the Dallas area, the shadow inventory was 6.7 months, the California-based mortgage and finance analysts said in a report released Monday.

Among the 50 largest U.S. cities, the average shadow inventory is almost 16 months, CoreLogic found.

The highest shadow home inventory was in the Miami area. All of the Texas markets were near the bottom of the shadow inventory list, with the lowest in Austin.

Statewide, Texas' shadow home inventory is 5.5 months, according to CoreLogic.

"Not surprising that Dallas and Texas, in general, show relatively low shadow inventory," said Dr. James Gaines, economist with the Real Estate Center at Texas A&M University. "We simply didn't get as overextended nor have we had the volume of foreclosures relative to other markets."

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