[IMGCAP(1)]

IRVINE, CA-Several Western markets have seen foreclosure starts increase dramatically despite nationwide defaults being down 28% over May 2012, reports RealtyTrac, a locally based online source of real estate and foreclosure data. Foreclosure starts increased 108% year-over-year in Hawaii, 81% in Nevada and 53% in Washington.

Foreclosure filings were reported on 148,054 properties in May, an increase of 2% from the 75-month low in April, RealtyTrac reports. The foreclosure problem continued to shift away from non-judicial states and toward judicial states, which accounted for five of the top six foreclosure rates nationwide. At number two, Nevada's foreclosure rate was the highest ranked among non-judicial states.

“Foreclosure activity continued to bounce back in some markets where it may have appeared the foreclosure problem had been knocked out by an aggressive combination of foreclosure-prevention efforts over the past two years,” said Daren Blomquist, VP of RealtyTrac, in a prepared statement. “Places like Nevada, where foreclosure starts increased to a 20-month high, and Maryland, where overall foreclosure activity increased to a 33-month high. Still, the emerging housing recovery has strengthened most local markets enough to quickly shake off a few more blows from these nagging foreclosures.”

According to Rich Cosner, CEO of Prudential California Realty, “Given that 2005 was one of the best real estate markets in history, what we may be seeing is that the foreclosure levels and NOD levels are bottoming out at their historical lows. Those few foreclosures selling at the courthouse steps are being bought at almost market-level prices and are being paid for in cash by investors.”

As GlobeSt.com reported earlier this week, both the financing and the construction portions of owning a fixer-upper require readiness and wise decision-making on the part of buyers, according to RealtyTrac. Blomquist said in a prepared statement, “Low-priced homes are still plentiful in many markets, particularly in the form of foreclosures. While these homes may be in need of more work than a typical home and are certainly harder to find now than in previous years, buyers and investors willing to put in a little extra legwork and sweat equity can often find the best deals in their markets on these foreclosure fixer-uppers.”

[IMGCAP(2)]