In an extremely weak market home sales for the third quarter of 2010 plunged over 30% on average and much higher in the south and southwestern states.
In all, 188,748 U.S. homes in some stage of foreclosure were sold in the July-September period, accounting for a quarter of all U.S. residential property sales.
This is after the Obama Administration reached out to many large banks and required a stop of new foreclosures. After that measure failed to lower the number of homes on the market which were bringing down home prices banks were investigated for sloppy paperwork in the processing of foreclosures.
In 2005 foreclosure sales accounted for just 1 percent of all sales.
Verification of thousands of forms in Florida and other states put a hold on foreclosures as a temporary stop gap measure to keep home values high. The main reason behind this was to keep tax assessments from falling at a time when local governments were losing revenue and home owners with values on county records 1/3rd or higher then the actual market value were bringing suit to have property taxes reduced.
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The average sales price of foreclosure properties in the quarter was $169,523, or 32 percent below the average sales price of non-distressed properties.
Nevada led the nation with foreclosure sales accounting for nearly 54 percent of all home sales.
The first and second quarters of 2011 is expected to see a flood of held foreclosures hit the market. This will include all of the homes that were placed on hold and should have a significant effect on market prices.