TG: Much like the old Realtor’s mantra of location, location, location, there will be the new banker’s mantra of inventory, inventory, inventory.
The banks do not have a choice. At present, they are only putting out less than 30% of their REO inventory. The rationale was that by so doing they would keep prices from cratering and thereby recoup as much value as possible.
It now appears (post 1Jan08) that they are going to get whatever price they can, and clear the books. This pressure is only going to increase, so it will be very interesting to see what happens next.
