For the last three or four months all the REO agents we deal with have said there is a whole lot of inventory coming down we just have to “wait”. This inventory has constantly been two or three months away from hitting the market. Now it seems like the agents we talk to are less and less confident that there is additional inventory coming anytime soon.
We have heard that REO World manages the assets for WAMU (now Chase) has recently laid of 25 of their workers and is in the process of laying off another 20. This must mean that they are not that confident that they will be getting a plethora of new inventory soon.
The amount of Trust Deed sales hasn’t changed at all, so banks are still taking on a lot of properties and it sure does not feel like sales are up enough to absord all the inventory. I have heard a rumor but cannot find any additional information on it that Fannie Mae is renting out a lot of their inventory rather then selling it.
Although, this process is very uneasy for an investor, holding back all the pent-up inventory will prolong the down turn which is bad for most people, but actually allows investors with limited cashflow more opportunities to pick up deals in the market place.
The next 12 months should be interesting…