According to a new estimate by Standard & Poor’s Rating Services - Denver has approximately three more years of foreclosed homes lurking in the shadows. The curiously named "shadow market" represents all of the distressed properties that the banks own but have not yet been placed on the open market. (Others include in that definition homes that still have an attached mortgage but are at least 90 days delinquent.) Essentially, they are non-performing assets sitting on the bank's books. Denver's alleged 3-year shadow inventory is still less than the national average of more than 4 years by most estimates.

So what does this mean to you as a potential buyer or homeowner looking to sell your home?

Not much.

First, there's been a lot of chatter about the shadow inventory for several years now. Shadow talk illicits more fears and further concerns about an already over-hyped, declining real estate market. Frankly, it's just more conjecture that serves as a juicy headline but has yet to materialize.

Second, the potential for the shadow market to cause damage exists, ONLY if the market were to be flooded all at once with the looming inventory. In that case we would have an excessive supply that far outweighs the demand. Foreclosure home prices would plummet. In fact it would adversely affect homeowners who are trying to sell non-distressed properties as well.

There's one big problem, though. Is that type of inventory infusion realistic? No way.

The banks will release these distressed properties at a steady pace over the next few years. Otherwise, they would have to sell these homes at serious fire sale prices. Buyer's would be clambering for these homes, "buy and hold" investors would would froth at the mouth, and the banks would lose a ton of money. It's just not realistic. What does the bank have to gain by doing that?

Honestly, I think the shadow inventory hype is just that - hype.

If you are considering selling your home, sit down with a qualified restate agent and figure out what your home is really worth based on TODAY'S current market. Not some ethereal speculation. In other words, don't worry about the shadow market.

If you are a buyer looking for a foreclosure home, don't wait any longer. Now is the time to buy. Interest rates are low, prices are low, now is the time to buy. When the market swings back in favor of the seller, you'll be sitting pretty.