The residential shadow inventory, or "pending supply" of distressed homes that have not yet reached the housing market, has declined substantially since the end of the recession without significantly impacting the larger market. The total shadow inventory declined by double-digit percentage points for 16 months through January 2014, and completed foreclosures declined 15 percent year-over-year in February.

The shadow inventory of distressed, real estate owned and foreclosure-bound homes, long considered an obstacle to a sustainable housing recovery, was down 23 percent year-over-year in January, according to an April 3 report from housing analytics firm CoreLogic. Completed foreclosures also declined from January to February, indicating that the threat from the distressed inventory has largely passed.

Completed foreclosures, according to CoreLogic, declined 15 percent year-over-year in February. Completed foreclosures fell from 51,000 units in February 2013 to 43,000 in two months ago, which was also 7,000 fewer foreclosures than in January 2014, a decrease of 13.1 percent.

"The stock of seriously delinquent homes and the foreclosure rate are back to levels last seen in the final quarter of 2008," said Anand Nallathambi, president and CEO of CoreLogic. "The shadow inventory has also declined year-over-year for the past three years as the housing market continues to heal, including double-digit declines for the past 16 consecutive months."

The company said that since the financial crisis began in September 2008, there have been approximately 4.9 million completed foreclosures nationally, and estimates that the national residential shadow inventory stood at 1.7 million homes in January, down 23 percent from the estimated inventory of 2.2 million in January 2013.

CoreLogic said that the inventory decreased at an average monthly rate of 41,000 units from January 2013 to January 2014. The dollar value of the shadow inventory in January was $254 billion, compared to $324 billion in January 2013 and $289 billion in July 2013.

"Although there is good news that completed foreclosures are trending lower, the bigger news is the impressive decline in the foreclosure and shadow inventories," said Dr. Mark Fleming, chief economist for CoreLogic. "Every state has had double-digit, year-over-year declines in foreclosure inventory, which is reflected in the $70 billion decline in the shadow inventory."