REI Wealth Monthly Issue 07 | Page 56

A GREAT TIME TO INVEST IN REAL ESTATE LEX LEVINRAD No one knows exactly how much shadow inventory there is, but there is no doubt that there is a lot of shadow inventory out there. I have heard real estate listing agents and asset manager’s talk about shadow inventory since 2010, when more than 1 million homes were taken back by lenders through foreclosure. In the State of Florida alone, there were 377,000 foreclosure cases still pending, as of October 31, 2012. And according If you read the mainstream media, the forecast for to the Florida State Court Administrator, there will real estate seems bleak. This is especially the be another 165,000 foreclosure filings for the case in hard hit states like California, Florida, period 2012 to 2013. That is a whopping half a Arizona, Nevada, Illinois, Ohio, Michigan and New million homes that are either in foreclosure or will York. All of this bad news in the media gives the be over the next year just in the State of Florida. average reader the impression that now is not a great time to be buying real estate. After all, why According to the February 2013 Foreclosure would you invest in real estate if there is so much Trends negative news? by RealtyTrac, a California-based company that tracks foreclosures, there are approximately 1.5 million homes in foreclosure in Negative news has a negative effect on buyers, the 307,000 forcing them to sit on the sidelines while they wait California for better news. Adding to the negative news is the (152,000), Illinois (137,000), Ohio (82,000), New fact that over the past few years it has been very York (51,000). difficult for home buyers to get approved for a According to RealtyTrac, in February 2013, there mortgage. This is yet another reason why potential were approximately 31,700 foreclosure filings in home buyers might sit on the side lines and wait the State of Florida. This means that 1 in every for the situation to improve. United foreclosure States. homes (71,000) and Florida followed New has by Jersey 282 homes in Florida received a foreclosure filing in February 2013. In the same month, California Real estate investors like myself that are actively had over 18,000 foreclosure filings followed by involved in buying and selling bank owned Illinois (12,600), and Ohio (10,500). There may be properties on a daily basis see an entirely different another 600,000 homes that will be taken back by picture to the one that the media portrays. What I the banks through foreclosure. see on the ground on a daily basis is that there a ?B??