Foreclosures sell at 30% discount

Foreclosures accounted for a third of all sales -- and sold at a nearly 30% discount -- during the first three months of 2010.

According to a new report from RealtyTrac, the marketer of foreclosed properties, 31% of all sales were foreclosures. And homebuyers purchasing those properties paid a whopping 27% less, on average, compared to sales of non-distressed homes.

These foreclosure sales include properties sold in short sales or after a bank repossession, known as REOs in industry terms. It does not include transfers from borrowers to banks, as in a sheriff's auction.

REOs, those homes already taken back from borrowers, commanded lower prices than short sales and other pre-foreclosures. The average REO sold for 34% less than conventional sales while pre-foreclosures averaged only 15% less.

Part of the reason for the bigger price cut for REOs is that many of them come to the market in poor condition, their previous owners either unable to or unwilling to maintain them.

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