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Shadow Inventory in the Aspen / Snowmass Real Estate Market

Recently there has been much talk nationally about “Shadow Inventory”. This refers to home sellers who have either pulled their house off the market or are choosing to wait for the “market to get better” before listing. While, on the national level, supply has continued to decrease to what are considered stable levels, the concern is that there are potentially millions of home owners who are just waiting to list once they perceive things to be better.

Clearly the risk of this is a return to the high levels of inventory that have caused prices to fall. Additionally, because of accounting rules, many banks are choosing to hold on to foreclosed properties since they can keep them on their balance sheet as an asset with a higher value – once they sell they have to reflect the actual loss.

So how might this play out in the Aspen / Snowmass and area market? From the foreclosure point of view, even though the number of bank owned properties is still rising, it does not seem to be a large enough part of the market to “flood” inventory, and up to now it appears that banks have been listing their properties in a reasonable time frame.

On the other hand, in Aspen, Snowmass and all the way to Western Garfield County, many sellers have been either withdrawing their properties or not re-listing them at the end of their agreed listing period.

Only time will tell, but it does appear that there will continue to be more supply than demand in the Aspen / Snowmass area for a good while yet.

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