Even as the housing market recovers and prices improve, a potential threat is appearing: “zombies.” Foreclosure zombies are created when a bank files for foreclosure on a property, but abandons the foreclosure process at some point which leaves the property in limbo – vacant but not for sale.
This comes at a time when many markets are dealing with inventory shortages and multiple offers. Analysts expect the zombies to come onto the market, along with other currently delinquent properties, in the second half of 2014.
Florida has the highest number of unoccupied foreclosure zombies, 55,503 according to RealtyTrac. There are approximately 167,000 zombies across the country. And this does not include the hundreds of thousands of properties still going through lengthy judicial foreclosures or those REOs not yet listed for sale by banks. RealtyTrac says the top three banks with foreclosure zombies are Bank of America, Wells Fargo and JP Morgan Chase.
