This is the strategy of most banks when it comes to handling a flood of properties that once were occupied by delinquent homeowners. Real estate agents from all over the country have been saying that this is a disastrous strategy.
“My biggest fear right now is that the supply has been artificially restricted,” said Jayson Meyerovitz, a local broker. “They can’t just sit there forever. If so many houses hit the market, what is going to happen then?”
This broker was recently quoted in The New York Times. His thoughts reflect the way most brokers feel about the situation.
All told, banks own more than 872,000 homes as a result of the groundswell in foreclosures, almost twice as many as when the financial crisis began in 2007, according to RealtyTrac, a real estate data provider. In addition, they are in the process of foreclosing on an additional one million homes and are poised to take possession of several million more in the years ahead.