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.

Be prepared for any home emergency.

Be prepared for any home emergency

Sometimes disaster strikes, despite your best efforts to prevent it. And that means you should always be ready for the unexpected.

The right emergency gear will help you protect your home and family, as well as deal with unpleasant realities like a post-storm power outage or broken windows.

Here are the most critical tools and products to have on hand when things go wrong.

Throughout the house

Place wireless water alarms under sinks, behind the fridge, anywhere that water would pool if there’s a leak — they’ll sound off at the slightest hint of moisture. Zircon Leak Alert three-pack, $25; amazon.com

Keep a fire extinguisher on every floor of your home, and an extra one in the kitchen, where the majority of fires start (some insurance policies will give you a discount on your premium for having them). Get multipurpose A:B:C extinguishers that douse flames from three types of fires: ordinary combustibles, flammable liquids, and electrical. Opt for a five-pound fire extinguisher, which is light enough for most people to use easily. Check the pressure gauges periodically and have the extinguishers recharged when the pressure drops. Kidde Full Home fire extinguisher, $40; homedepot.com

Supplement hard-wired smoke detectors (if you have them) with at least one battery-powered model per floor, especially in the kitchen and near bedrooms. Go with a model with a sealed-in, 10-year lithium battery to spare you frequent battery replacement. Kidde Long-Life sealed battery smoke alarm, $20; walmart.com

For the best protection, opt for separate carbon monoxide alarms instead of combination smoke/CO detectors. Place one on every level of the home and outside each bedroom or sleeping area so that occupants will wake up if it goes off at night. Plug-in versions with battery backups are convenient and discreet. First Alert plug-in carbon monoxide detector, $33; amazon.com

Basement, laundry, and mechanical room

A sump pump alarm has a sensor wire and probe that detect rapidly rising water levels, tipping you off to a potential flood. Reliance Controls sump pump alarm, $15; homedepot.com

An automatic shutoff valve for your water heater cuts off the supply to the device as soon as it senses a leak of any kind. FloodStop auto shutoff valve for water heaters, $115; safehomeproducts.com

If you forget to turn off the water supply to your washing machine when you’re finished sudsing your duds, then this is the gizmo for you: a switch that automatically opens the valve as soon as you turn the machine on, and then closes it when the rinse cycle is over. Watts IntelliFlow automatic washing machine shutoff valve, about $200; amazon.com

Upstairs bedrooms

Place sturdy escape ladders in each bedroom near a window. Practice setting them up in case you have to do it quickly. First Alert three-story fire-escape ladder, $72; target.com

Collect all your gear in a waterproof plastic tub and stow it in an easy-to-access spot in your house.

1. Duct tape. Use it for on-the-fly repairs and temporary fixes. $3.50 per roll at home stores

2. Blanket. Mylar is warm and lightweight, and folds up small. $3.50; grainger.com

3. Multitool. Get one with a pair of pliers and a can opener. $55; leatherman.com

4. Radio/phone charger. A hand crank will allow you to juice up the battery. $20; amazon.com

5. Work gloves. Leather grips protect your mitts during poststorm cleanup. $48; ironclad.com

6. Nylon rope. Use it to secure heavy outdoor furniture or tie down a flapping door.$30 per 100 feet at home stores

7. Lantern. A battery-operated model is safer than candles. $40; coleman.com

And add these multitaskers:

8. Fishing line. Use it wherever rope is too thick to get the job done.

9. Vinyl tablecloth. Lay it down to create a clean zone in any area.

10. Baby wipes. They’ll remove grime from your hands and practically any surface.

Make sure to include first-aid supplies, three days’ worth of bottled water and nonperishable food, and a list of important phone numbers.

Living off the grid in a mail-order home.

Living off the grid in a mail-order home

NEW YORK (CNNMoney) — House Arc may look like an egg-shaped antidote to McMansion mania, but this small mail-order home was really designed as a way to quickly provide housing to victims of disaster.

“We wanted to see how we could produce a house that would fit into a flat packing container that could be shipped to communities in need, like New Orleans after Katrina,” said architect Joseph Bellomo, who worked on the modular home for two and a half years.

The result was House Arc, a 150-square-foot structure of hollow steel tubes. Not only can the 3,000-pound modular home withstand high winds, it can also be boxed into a 120 cubic-foot freight container and shipped off to its next destination.

House Arc is designed to be put together like a piece of Ikea furniture, according to Bellomo. In other words, anyone with moderate carpentry skills should be able to assemble it. If the home is no longer needed, it can also easily be taken apart and shipped somewhere else.

The curved design is so strong because it works like an arch, spreading the weight of any load, such as the pressure of a strong wind, across the surfaces rather than allowing it to concentrate on one spot.

For Bellomo, it was important for the home to be practical yet also attractive. Disaster victims are often relegated to substandard housing conditions, packed into trailers or even tents for months after they lose their homes, he said.

Bellomo was inspired to create the modular home after he made Bike Arc, a steel-arched shelter that riders could lock their bikes into.

Even though House Arc has a footprint of less than 100 square feet, it’s roomier inside, thanks to walls that bow out and nine-foot high ceilings.

The cozy mail-order home can also be added to a backyard to expand living space, say as a guest house. Or it could be used as a cabin in the woods.

But the cost is still high, at a base of about $55,000. However, Bellomo wants to automate the production process, which should cut the price at least by half, he said.

Options for the modular home include plumbing, ceiling fan and solar panels for the roof. At this point, customers would have to arrange for these installations themselves.

Home prices lowest since 2002.

Home prices lowest since 2002

NEW YORK (CNNMoney) — Home prices hit new post-bubble lows in March, according to a report out Tuesday.

Average home prices were down 2.6% from 12 months earlier, according to the S&P/Case-Shiller home price index of 20 major markets. Home prices have not been this low since mid-2002.

“While there has been improvement in some regions, housing prices have not turned,” said David Blitzer, spokesman for S&P.

Although five cities — Atlanta, Chicago, Las Vegas, New York and Portland — saw average home prices hit new lows, that’s an improvement from last month’s report, in which nine cities notched new lows, Blitzer noted.

Where home prices are rising fastest

In 13 of the 20 cities, average home prices fell in March from the year before. Atlanta fared the worst, with home prices down 17.7% year over year. Home prices in Atlanta, Cleveland, Detroit and Las Vegas are all below their January 2000 levels.

Alternatively, Phoenix posted the largest gain, with prices up 6.1% from last year. Other cities showing an uptick included Dallas, Denver and Miami.

Overall, the 20-city composite is down about 35% from its peak in 2006.

Experts say affordable mortgages, combined with much lower home prices, should help to bolster the housing market.

“It’s probably the best time to buy a home in decades,” said Pat Newport, an analyst for IHS Global Insight.

“But the problem is that unless you have good credit, you are probably going to have trouble qualifying for a loan,” he added, referring to overly tight lending conditions.

Last week, a report by the National Association of Realtors showed that home sales jumped in April. Sales of new homes were also higher in April, according to a separate government report.

“This might be a strong season, but there’s a good chance we’ll continue down for years still,” said Robert Shiller, professor of economics at Yale University. “There’s too much uncertainty.”