In the wake of the housing market collapse, the real estate market was flooded with a wave of distressed properties. However, as conditions stabilize, the rate of short sales is expected to build momentum throughout the country in 2012.
Real estate data indicates that the rate of short sales spiked 33 percent at the beginning of 2012 from a year earlier in 32 states with high level of distressed properties, according to RealtyTrac. The most notable of these states were Georgia, Michigan, Wisconsin, California and Texas.
"Short sales have long held great promise as a market-based solution to the nation's foreclosure problem, but short sales transactions over the past three years have actually declined after peaking in the first quarter of 2009," said RealtyTrac vice president Daren Blomquist.
Meanwhile, the report found that short sales outpaced REO sales in 12 states, including Arizona, California and Florida. After the real estate collapse, these three states had some of the highest rates of distressed property owners in the country. As the number of short sales throughout these states continue to gain momentum, it could help to stabilize home prices in the future.