http://www.bloomberg.com/news/2012-09-18/new-jersey-housing-suffers-as-defaults-exceed-nevada-mortgages.html

From this article:

Higher-income markets, such as New Jersey’s Morris and Bergen counties, will probably avoid the worst pain because there’s a shortage of homes and when distressed properties are listed, “the housing market will swallow them whole,” according to Jeffrey G. Otteau, president of Otteau Valuation Group Inc., in East Brunswick, New Jersey.
“In the employment-rich suburban submarkets, this will be much like the gulf oil spill,” Otteau said in an e-mail. “For the most part, it never happened. The foreclosure wave will be the same way.”

"Wendell and Margret Brady haven’t paid their mortgage in more than three years, withholding the money amid a foreclosure dispute on the couple’s 11-bedroom house in Morristown, New Jersey."

wow, it's great news for everybody that this charade doesn't go on forever. NYC metro area also got to freeze its REO pipeline for no reason, better to allow those who cannot pay to move on.

in a way, those of us that knew housing will suck for a decade or two have yet to play it optimally. we should purchase as much house as possible and don't make a single payment, living home payment free for at least 3 years. that's the biggest lesson from this bubble imho.

weve been hearing the shadow inventory theory for quit a while and still nothing.