Sales of homes that were in some stage of foreclosure or bank owned accounted for 26% of all residential sales during the first quarter ended March 31 - up from 22% of all sales in the fourth quarter and up from 25% of all sales in the year-ago period, according to RealtyTrac's U.S. Foreclosure Sales Report. RealtyTrac is an online marketplace for foreclosure properties.

Third parties purchased a total of 233,299 residential properties in some stage of pre-foreclosure (defaults and scheduled foreclosure auctions) or bank-owned REO during the quarter, an increase of 8% from the previous quarter and virtually unchanged from the first quarter of 2011.

The average sales price of homes in foreclosure or bank owned was $161,214 in the first quarter, down 1% from the previous quarter and down 2% from the first quarter of 2011. That average sales price was 27% below the average sales price of homes not in foreclosure or bank-owned during the quarter - matching a 27% foreclosure discount in the previous quarter but down from a 29% foreclosure discount in the first quarter of 2011.

“Foreclosure-related sales picked up in the first quarter, particularly pre-foreclosure sales where a distressed homeowner is selling to avoid foreclosure - typically via short sale,” said Brandon Moore, CEO of RealtyTrac. “Those pre-foreclosure sales hit a three-year high in the first quarter even as the average pre-foreclosure sales price dropped to a record low for our report. Lenders are approving more aggressively priced short sales, which in turn is resulting in more successful short sale transactions.

“Meanwhile the average price of a bank-owned home is stabilizing and even increasing in some areas where a slowdown in REO activity over the past year has resulted in a restricted supply of REO homes available,” Moore said. “Still, REO sales did increase on a quarterly basis in 21 states, indicating that lenders are still working through a bottleneck of unsold REO inventory in many areas."

Third parties purchased a total of 109,521 pre-foreclosure homes - in default or scheduled for auction — during the first quarter, an increase of 16% from the previous quarter and an increase of 25% from the first quarter a year ago.

First quarter pre-foreclosure sales were at their highest quarterly level since the first quarter of 2009. Pre-foreclosure sales accounted for 12% of all sales during the first quarter, up from 10% of all sales in the previous quarter and 9% of all sales in the first quarter a year ago.

Pre-foreclosure sales increased on an annual basis in 27 states, including Wisconsin (94%), Michigan (81%), Georgia (80%), Texas (46%), and Illinois (46%).

Pre-foreclosure homes, which are often sold via short sale, sold for an average price of $175,461 in the first quarter, down 4% from the previous quarter and down 10% from the first quarter a year ago. The average pre-foreclosure sales price in the first quarter was the lowest quarterly average pre-foreclosure sales price in the history of the RealtyTrac foreclosure sales report, which tracks foreclosure sales back to the first quarter of 2005.

Third parties purchased a total of 123,778 bank-owned (REO) homes in the first quarter, up 2% from the previous quarter but down 15% from the first quarter of 2011. REO sales accounted for 14% of all sales in the first quarter, up from 13% of all sales in the previous quarter but down from 15% of all sales in the first quarter a year ago.

Foreclosure sales accounted for 56% of all residential sales in Nevada in the first quarter, the highest percentage of any state. The average price of a foreclosure-related sale in Nevada during the first quarter was $116,695, nearly identical to the average price in the previous quarter but down 5% from the first quarter a year ago.

California foreclosure-related sales accounted for 47% of the state’s total residential property sales in the first quarter, the second-highest percentage among the states. The average price of a foreclosure-related sale in California was $235,042 during the first quarter, an increase of less than 1% from the previous quarter and down 4% from the first quarter a year ago.

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