Foreclosures made up 26% of U.S. home sales in first quarter.

Foreclosures made up 26% of U.S. home sales in first quarter

NEW YORK (CNNMoney) — Homes in some stage of foreclosure accounted for more than one in four home sales during the first three months of the year, according to a report released Thursday.

Distressed properties that were either in default, scheduled for auction or bank-owned accounted for 26% of all residential sales during the first quarter, up from 22% in the previous quarter and 25% a year earlier, RealtyTrac said.

Altogether, 233,299 distressed properties were purchased during the quarter, an 8% increase from the previous quarter. Those homes sold for an average of $161,214, 27% below the average price of a home not in foreclosure.

“Foreclosure-related sales picked up in the first quarter, particularly pre-foreclosure sales where a distressed homeowner is selling to avoid foreclosure — typically via a short sale,” Brandon Moore, chief executive of RealtyTrac said in a statement.

Pre-foreclosure sales, which are often sold as short sales, hit a three-year high during the quarter “even as the average pre-foreclosure sales price dropped to a record low,” Moore said.

There were nearly 110,000 short sales in the quarter, up 25% from a year earlier and comprising 12% of all homes sold during the first quarter, according to RealtyTrac.

In short sales, borrowers who owe more on their mortgages than their homes are worth, agree with their bank to sell their homes at the lower market value. In return, the bank agrees to absorb the loss.

During the quarter, homes sold in short sales went for an average price of $175,461, the lowest level since RealtyTrac began tracking foreclosures in 2005.

Short sales are becoming the preferred method for banks to unload properties in default.

Banks typically get about 20% more for a short sale than they would for a foreclosed home. In addition, short sale deals get done much more quickly than foreclosures, which can take years to unload, during which expenses, like property taxes and insurance, mount up.

During the first quarter, it took an average of 306 days to complete a short sale, compared to 370 days for a foreclosure.

“Lenders are approving more aggressively priced short sales, which in turn is resulting in more successful short sale transactions,” Moore said.

Meanwhile, sales of properties repossessed by the banks, called REOs, fell 15% year-over-year to 123,778, comprising 14% of all sales during the quarter.

Nevada, where housing bubbled during the boom and sank during the bust, had more distressed property sales than any other state, followed by California and Georgia, RealtyTrac said

4 ways to save on landscaping.

4 ways to save on landscaping

(Money magazine) — There’s no better place to build sweat equity than landscaping.

A high-end landscaping contractor will charge at least $5,000 to remodel a typical compact suburban front yard. Yet if you can handle a shovel, hose, and wheelbarrow, you have the physical skills to replace overgrown or mundane greenery with fresh plants, boosting curb appeal and possibly property value.

The tricky part is getting the landscaping design right; it’s not as simple as putting a few plants in the ground. Here’s how to achieve that upscale look on your own.

1. Broaden the beds of landscaping

A single-file row of plants along the foundation and the property lines looks generic at best.

Widen the beds to four to six feet so there’s room for more flora — and to make the plants really pop, use mulch that’s the color of soil, says Newport, R.I., landscape architect Kate Field.

That means the fine, dark, compost-like material that costs about 25% more than basic wood chips, or about $120 to $150 (delivered), and that lasts only one year.

2. Focus on foliage in landscaping

Replace oversize or drab plants with new shrubs and perennials arranged two or three deep, with smaller plants placed in front of larger ones (check the mature size listed on the label).

“Don’t get hung up on picking the best flowers,” says Portland, Ore., garden designer Darcy Daniels. That’s because blooms are short-lived; it’s the foliage that you’ll see most of the time.

Look for plants with red, purple, or multicolored leaves, as well as a variety of textures, from fine light-green needles to broad dark-green fronds.

Alternate shapes too, with, say, a conical spruce near a chunky hydrangea. You’ll pay $20 to $100 per plant, depending on type and size.

3. Accent the architecture in your landscaping

Create a focal point of your landscaping using a dwarf tree or a large shrub. Don’t just plunk it in the middle of the yard. Instead, place it in line with a structural element of the property, such as a corner of the house, garage, or lot.

Japanese maples ($100 to $400) and crepe myrtles ($30 to $50) are two good choices that look attractive in all seasons, says Severna Park, Md., nursery owner Gary Blondell.

4. Trim your landscaping with technique

When it comes to caring for your plants, ditch the electric clippers, which carve bushes into perfect geometric shapes.

“That look is passé,” says Field. Unless you’re trimming a hedge, always cut the branches to slightly varied lengths one by one using a hand tool, such as Felco’s Classic Pruner ($52 at amazon.com). You’ll get a more natural, flattering look.