Foreclosures are the lesser of the two evils.
Some are a good deal, some are not such a good deal, some will eventually be a good deal.
Short sales on the other hand are like my wife's cooking, you`re taking your chances.
Today's buyers seem to be focusing on foreclosures and bank approved short sales as the place they feel safest in today's uncertain times.
You may find these stats interesting comparing bank owned, short sales and NON bank owned/short sale
Southwest Las Vegas Area priced under $300k since 1/1/08
430 Bank owned property sales
Median sale price per square foot $119.86
Average sale price per square foot $120.84
Median list price to sale price = 100%
89 Short Sales (only 89 closed!!!)
Median sale price per square foot $129.70
Average sale price per square foot $128.64
Median list price to sale price = 99%
512 NON short sale or foreclosure sales
Median sale price per square foot $131.55
Average sale price per square foot $135.19
Median list price to sale price = 98%
In the late 80's we had a period when houses lost about 50% of their value, most of the houses went back to the banks, and then they banks went broke so they went to HUD or FDIC etc.
You could buy a house "as is" for $100 down. A house that went for $130K brand new in 1985 could be purchased in 1988 for $55K and only $100 down to move in.
It will take a little while before we get to that point. But when and if we do, they are a good deal.
My advice.. buy a home less than 7 years old. All the kinks are worked out,decks are on, basements have been finished. landscaping done. They're turn key.