Positive signs from the U.S. real estate market have begun to see an influx of interested Canadian investors. U.S. foreclosure rates are down, housing statistics are up and homes have started to appreciate in value for the first time since 2006. Many Canadians are wondering if there are still opportunities in U.S. real estate and what role the U.S. shadow inventory will play in future market values.
As competition for U.S. real estate is on the rise, rumors about the U.S. shadow inventory have begun to circulate. Although exact numbers remain unknown, financial experts estimate shadow inventory at anywhere from 3 million to 10 million homes. According to a recent study conducted by CoreLogic, the shadow inventory is worth approximately $246 billion dollars. In other words, the shadow inventory will definitely play a role in the U.S. housing economic conditions and lending practices in the near future.
Given the gradual positive incline in U.S. real estate values, the release of shadow inventory is expected in the near future. Recent estimates are projecting roughly 4.16 million homes that could begin to flow to the U.S. real estate market. Further, there are speculations of an additional 6.5 million additional foreclosures going forward. Question is: how will it affect the housing market value and investment opportunities?
Well, to get to the point here, shadow inventory is essentially a good thing for Canadians interested in buying and selling U.S. real estate. As shadow inventory is slowly released into the market, prospective buyers will have more options while sellers will be more inclined to price property to sell. On a monthly basis, housing values may dip or rise yet the U.S. housing market is showing signs of recovery and the shadow inventory ensures a continued buyers advantage. In sum, U.S. real estate is still an amazing opportunity, especially in a long-term investment scenario and shadow inventory releases will continue to pump out new units for buyers to consider. Happy hunting!