Shadow inventory stalks Tampa Bay housing market

How much shadow inventory is stalking the Tampa Bay housing market?

Shadow inventory means homes that should hit the real estate listings but don't for economic reasons.

Tampa real estate consultant Tony Polito, who was a panelist Thursday at a business breakfast sponsored by the Tampa Bay Builders Association, tried to size up the problem — admitting how hard it is to get a grip on something so ephemeral.

Polito's guesstimate: Shadow inventory represents at least 14,000 homes atop the 28,000 homes already listed for sale in Tampa Bay.

Polito defined shadow inventory broadly. He counted not just foreclosure and pre-foreclosure homes tucked away in bank portfolios, but home sellers sitting on property for lack of buyers.

If you toss shadow inventory into the pot, the market's recent progress recalibrating supply and demand looks a lot less impressive.

Many question why shadow inventory even matters. If these homes aren't for sale, how much of a housing glut can they cause?

But builders at the business breakfast had good reason to dread the shadow. Last year was likely the worst year for Tampa Bay housing starts in decades. These homes, like black holes, drift unseen on the edge of the market, eventually exerting a formidable pull.

In such a depressed environment, the last thing a builder needs is discounted homes materializing next door and undercutting prices already depressed 40 percent.

Average Joe and Jane home­owner probably sense the shadow in the rental homes cluttering their suburban streets. Bought by investors during the boom, these homes, many with delinquent mortgages, will go up for sale at the first profitable or not-so-profitable opportunity.

These doppelganger homes play havoc with predicting a real estate recovery. The general consensus among builders: A tepid upturn in 2010 turning hotter in 2011.

Polito suggested that tracking shadow inventory is like tracking a ghost in the fog.

Banks are tight-lipped about distressed properties on their books. As for homeowners desperate but unable to sell, how do you measure their motivations without an advanced degree in mind reading?

"I've never seen a real good measurement of exactly what it is," Polito said of shadow inventory on Thursday.

So there's hope: Like a short shadow at noon, the problem might be smaller than feared.

James Thorner may be reached at jthorner@sptimes.com or (813) 226-3313.