IRVINE, CA-Nationwide, the number of properties sold duringthird-quarter 2012 that were in some stage offoreclosure or bank-owned REOincreased 21% over the previous quarter, although that number isstill down 3% from third-quarter 2011, according to a recent reportfrom RealtyTrac, an online marketplace forforeclosure properties. The report also shows thatforeclosure-related sales accounted for 19% of all US residentialsales during Q3, down from 20% in the previous quarter but the samelevel as in third-quarter 2011.

Also, unlike in recent years, sales of properties in some stageof foreclosure outnumbered sales of foreclosed, bank-ownedproperties in the third quarter. And short sales of properties notin the foreclosure process increased 15% in Q3 from the previousquarter, a rise of 17% from the year before.

“The shift toward earlier disposition of distressedproperties continued in the third quarter as both lendersand at-risk homeowners are realizing that short sales are often abetter alternative than foreclosure,” said DarenBlomquist, VP of RealtyTrac, in a prepared statement.“However, the scheduled expiration of the MortgageForgiveness Debt Relief Act at the end of this year couldstifle this trend toward short sales.”