As for Shadow Inventory, I believe the FDIC numbers tell a lot of the story. For Past Due and Nonaccrual Assets here are some of the numbers for “1-4 family residential properties” only, unless noted otherwise.
As of 6/30/09:
Past Due < 90 days: $68.2 Billion
Past Due > 90 days: $64.8 Billion
Nonaccrual Status: $83.5 Billion
Total: $216.5 Billion
As of 3/31/09:
Past Due < 90 days: $74.8 Billion
Past Due > 90 days: $56.3 Billion
Nonaccrual Status: $78.3 Billion
Total: $209.4 Billion
As of 12/31/08:
Past Due < 90 days: $79.2 Billion (Peak)
Past Due > 90 days: $44.9 Billion
Nonaccrual Status: $59.6 Billion
Total: $183.7 Billion
It appears banks have added $32.8 Billion in distressed properties. The Past Due > 90 days and Nonaccrual Status has greatly increased in two quarters. One might call that Shadow Inventory. Especially, those shown as Nonaccrual Status.
As for Shadow Sales, in order to sell properties at a discount, I would think you would have an charge-off for those properties.
As of 6/30/09 (Year to Date):
Net Charge Offs: $24.3 Billion
As of 3/31/09 (Year to Date):
Net Charge Offs: $10.7 Billion
As of 12/31/08 (Year to Date):
Net Charge Offs: $26.4 Billion
In six months, the banks have matched last year’s charge-offs. The question of shadow sales would be how much of these properties sold other than thru MLS. Banks have $57.1 Billion in distressed or charge-off’s. Total loans as of 6/30/09 is $2,685 Billion or 2.13% of all loan value.
One thing I did find new and interesting. FDIC has started to track restuctured loans. As of 6/30/09, $28.9 Billion of the loans were restructured. Principle reductions may have been shown in the charge offs.
Noncurent Loans to Loans:
As of 6/30/09: 5.52%
As of 3/31/09: 4.87%
As of 12/31/09: 3.8%
The Nonaccrual Status was 9.3 Billion when is started being tracked in 2001. It has grown to $83.5 Billion or 9 times. This is what I would consider as the definition ‘Shadow Inventory’.
