Monday, November 14, 2011

Monday Morning Coffee

Hello all,

“Shadow Inventory”

This has come up a couple of times in the office so I decided to look into a bit further to see where we stand. Shadow inventory are homes that the banks have already taken back plus homes where the mortgages are at least 90 days late. However they have not come to the market yet and are sitting in the shadows. The first lesson I learned is be careful what you read. I did a Google search on Shadow Inventory in Maryland, the first article I read made my mouth drop! My only thought was there was no way I could talk about this because it is SO depressing, then I looked at the date of the article and it was from October 2009, Phew. When I found more recent data the news got better but still not great. Seven states count for 60% of the shadow inventory in the country. Florida is the leader with 441,000 properties where Maryland has 44,000. Maryland was right in the middle of just about every category, the most discussed being the absorption rate of the shadow inventory. The rate is calculated by taking the number of properties considered to be shadow inventory divided by the number of distressed properties sold each month, short sales and foreclosures. In Maryland’s case we have 24 months of shadow inventory.  What does all this mean… Short sales and foreclosures count for around 30%-35% of our business (more in the winter months less in the spring) and the prediction is a 10% overall  increase in transactions next year. So while the transactions will increase the percentage of distressed properties will stay about the same. They are not going anywhere for a while so we need except it as part of the business.   

Enjoy the coffee,

Monday Morning Coffee


"We don't receive wisdom; we must discover it for ourselves after a journey that no one can take for us or spare us."
- Marcel Proust

ON MY HONOR . . . !
The Boy Scouts have long espoused the same set of principles. It goes like this: "A scout is trustworthy, loyal, helpful, friendly, courteous, kind, obedient, cheerful, thrifty, brave, clean and reverent." How simple life could be if we all practiced just that short list. Each in itself denotes a wonderful trait. When put into action, all can make the world a better place.
So, what happens between the age of scouting and age 30, 50, or 75? How is it that we turn from being a friendly 12-year-old to a suspicious, stand-offish adult? How do we turn the corner from being obedient to our elders to challenging the authority of our employers or government? Why won't we open the door for someone who can't? Did simple courtesy die with our youth?
Perhaps experience has taught us that others are not always friendly, courteous and kind. "Turn-about is fair play," we may respond. Why should we be thrifty, taking care to save for our future, when everyone around us has "maxed out" their credit cards? Reverence for all we know to be of value seems to have become the victim of political correctness. Why should we be any different?
The greatness of our country was built on the solid rock of "principles." The soft, easy life of an affluent society may be our undoing. Our forefathers had it tough. Most of us living today had a cake-walk, comparatively speaking. Our forbearers had to live their principles - or face the defeat of poverty, ill-health, and despair.
Our children can bring us back if only we will take the time to teach them those simple principles. More than teaching, we might help them practice those principles in their daily lives until habit makes them permanent. Begin while they are still playing in the sandbox. They will grow soon enough into men and women who live principle-centered lives!

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