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US Foreclosure Sales Dip Slightly in 3rd Quarter of 2011; Still High

iStockPhoto/Thinkstock(IRVINE, Calif.) -- The percentage of U.S. sales that involved residential homes in some stage of foreclosure dropped in the third quarter of 2011, according to the latest report by RealtyTrac.

The foreclosure tracking firm said Thursday that foreclosure sales fell by 2 percent from the second quarter, from 22 percent to 20 percent.  Compared to the third quarter of 2010, when they accounted for 30 percent of all sales, foreclosure sales were also down.

More than 221,000 homes nationwide were found to be in some stage of foreclosure during the third quarter of last year.  And while that number was down 11 percent from the second quarter and down five percent from the third quarter of 2010, foreclosure sales are still accounting for a large share of the market.

"That 221,000 represents 20 percent of all sales. And so, that's a high level.  In a normal, healthy market we would expect to see 5 percent of all sales be foreclosure-related," said RealtyTrac Vice President Daren Blomquist.

Western states were among the worst hit.

"The top three states in terms of percent of market-share that were foreclosure sales were, number one: Nevada, with 57 percent of all sales there were foreclosure-related.  Number two is California, with 44 percent of all sales being foreclosure-related.  And number three was Arizona, with 43 percent," he said.

But in what may be a promising sign, the average sales price of homes in foreclosure or bank-owned in the third quarter -- $165,322 -- was up 1 percent from the previous quarter.

"That is an indication that we may be getting close to a bottom, in terms of home prices with these foreclosures, which are the properties that are kind of  dragging down the rest of the housing market," Blomquist said.

It is worth noting, however, that the average sales price was down 3 percent from the same time period in 2010.

Copyright 2012 ABC News Radio

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