Record Number of Homes Vacant

Amid the many data points that economic forecasters focus on, the home vacancy rate is often overlooked. But this indicator has soared to record levels and merits attention as a harbinger of bad times to come, some market watchers say. For the third quarter of this year, 2.7% of homeowner (as opposed to rental) housing was unoccupied, according to the U.S. Census. Homes could be vacant due to foreclosure or could simply be lingering on the market after the owners departed. "We've never seen this before," James Swanson, chief investment strategist of MFS Investment Management, said today at a year-end outlook lunch in Midtown Manhattan.  In prior economic slumps the homeowner-occupied home vacancy rate never exceeded 1.9%, notes Dean Baker, co-director of the Center for Economic and Policy Research, an independent think-tank. The number reflects an imbalance of supply and demand and is a sign of concern, Baker says.