One possibility for the vacancies and a contributing factor to "phantom" inventory theories could be that the foreclosure process is taking longer than it has to.
That said, when the slow-moving foreclosure train hits the ever-falling sales train one might expect to see some really juicy price reductions (not stating anything new here).
Aside from data snooping, can one of the bank insiders (Davej or Bugs?) get us some info? Are lenders really holding inventory?
Another question is, are banks hesitating to foreclose? The best thing for them is to keep the borrower trapped in the sinking house. If I were the bank right now I'd hold off foreclosing as long as possible to see what other tax funded government bailouts come down the pipeline. If Barrack or Hilary get elected I'd imagine the banks will be expecting major bailout action.
