Two real estate stories really caught my eye last week, my friend Tom Royce's headline, 18.4 Million Vacant Homes in the U.S.A on The Real Estate Bloggers dot com, and Calculated Risk's Lawler: How Many Folks Have " Lost Their Homes" to Foreclosure/Short Sales/DILs? address numbers that we all may have trouble wrapping our heads around.
Calculated Risk cites economist Tom Lawler's numbers on home owners separated from their homes.
Over Four Million foreclose-able properties out there as we enter 2011. Talk about your Shadow Market!
Royce uses data from CNBC and the U.S Census Bureau to point out that 18.4 million or 11% of of all housing units in the United States are VACANT!
Assuming this information is correct, 18.4 Million units vacant + 4.3 million soon-to-be vacant properties. At least the number of vacant properties for rent dropped by 200,000 in 2010. The obvious question here seems to be, what happened to all the people who were living in those homes? It's hard not to think about the Shadow Market.
Are we looking at 22.7 million units out there that the market is going to have to absorb? With this apparent signal of waning interest in home ownership, how do we look at the future? Will the units be slowly absorbed as the economy recovers and the American Dream of home ownership is revived ? Will investors (perhaps cash-strong foreign investors) pick up every housing unit they can get their hands on, further eroding the ratio of owner-occupants to renters?
One thing's for sure, the Home Building Industry is optimistic, predicting 655,000 single family housing starts in 2011, and 970,000 starts in 2012. Maybe they know something the rest of us don't.
Maybe my premise and numbers are all wrong here. What do you think?