In my view this shadow inventory is at least part urban legend part truth,
The truth is that yes there are still a lot of homes that will sell under some sort of distress sale category and that will continue to depress the market some.
The other part is that Socal still needs more Single family homes, and any decent home at a decent price will get bought almost as soon as it hits the market in most of SD and TV anyway (maybe not some places like antelope Valley or whatever) and that will keep the market more or less level (or at least at about cost to produce) for a while yet.
