This an article I came across from one of the sites that I view. Gives a good recap of what has been happening

By Carrie Bay

RealtyTrac has released its year-end 2010 foreclosure sales report, which shows that foreclosure homes accounted for nearly 26 percent of all U.S. residential sales last year, down from 29 percent of all sales in 2009 but up from 23 percent in 2008.

The tracking firm defines a foreclosure sale as the sale of a property that occurs while the home is actively in some stage of foreclosure, including a pre-foreclosure short sale, a home sold to a third party at foreclosure auction, or an REO sale. It does not include property transfers from the owner in default to the foreclosing bank or lender.

RealtyTrac’s report also shows that the average sales price of these foreclosure properties was more than 28 percent below the average sales price of properties not in the foreclosure process – up from a 27 percent average discount in 2009 and 22 percent in 2008.

According to the company’s analysis, a total of 831,574 U.S. residential properties either owned by banks or in some stage of foreclosure sold to third parties in 2010. That’s down 31 percent from the number of foreclosure homes sold the year prior. Meanwhile, RealtyTrac says the sales volume of non-foreclosure properties in 2010 decreased nearly 19 percent from 2009.

Foreclosure sales during the final part of last year were impacted by robo-signing issues and the foreclosure moratoriums that followed from several major servicers. RealtyTrac reports that 149,303 foreclosure sales were recorded in the fourth quarter of 2010, down 22 percent from the previous quarter and down 45 percent from the fourth quarter of 2009. That comes despite a 21 percent monthly uptick in foreclosure sales volume in December.

James Saccacio, RealtyTrac’s CEO, points out that fourth-quarter foreclosure sales volume hit its lowest level since the first quarter of 2008, and in addition to the foreclosure paperwork controversy that hit at that time, he attributes the decline to stifled demand from the expired homebuyer tax credit.

Still, Saccacio notes that foreclosures continue to represent a substantial percentage of all U.S. residential sales. “The catch-22 for 2011 is that while accelerating foreclosure sales will help clear the oversupply of distressed properties and return balance to the market in the long run, in the short term a high percentage of foreclosure sales will continue to weigh down home prices,” he said.

Breaking down foreclosure sales by type, RealtyTrac reports that a total of 512,886 REO properties sold to third parties in 2010 at an average discount of 36 percent. REOs accounted for 16 percent of all sales last year.

A total of 318,688 pre-foreclosure properties — in default or scheduled for auction — sold to third parties last year, with an average discount of 15 percent. Pre-foreclosure sales accounted for nearly 10 percent of 2010 home sales.

Nevada (57 percent), Arizona (49 percent), and California (44 percent) posted the highest percentage of foreclosure sales in 2010.

Other states where foreclosure sales accounted for at least one-quarter of all sales were Florida (36 percent), Michigan (33 percent), Georgia (29 percent), Idaho (28 percent), Oregon (28 percent), Illinois (26 percent), Virginia (25 percent), and Colorado (25 percent).

Ten states posted foreclosure discounts of more than 35 percent, led by Ohio, with an average discount of nearly 43 percent, and Kentucky, where foreclosures sold for an average discount of 40 percent. The eight other states are: Tennessee, California, Pennsylvania, Illinois, New Jersey, Michigan, Georgia, and Wisconsin.