5 Cities Where Homes Are Still Cheap

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If you're bargain shopping for a home, don't be discouraged by the gigantic leaps home prices have been taking lately. There are still places where you can find cheap homes. You might start with the 10 best cities to buy short sales.

Short sales and foreclosures made up 43 percent of residential sales last year, according to RealtyTrac. And why is that? Because of the huge savings for buyers. A short sale or foreclosure offers a 30 percent to 40 percent discount off a non-distressed property, RealtyTrac said. And they're gaining in popularity: Short-sale purchases bumped up 4 percent from a year prior; foreclosure sales notched up 6 percent.

Market Watch took a look at some cities with cheap homes, led primarily by their abundant short sale and foreclosure offerings:

Santa Barbara, Calif.Santa Barbara, Calif.

Average short-sale price: $283,825.
Average discount vs. non-distressed sales: 42.69 percent.

Short-sale purchases in Santa Barbara rose 107 percent in the fourth quarter of 2012 compared to a year prior. That was the largest increase in the U.S. It's not hard to see why: The median price of all properties in the city was about $600,000. That lured a lot of homebuyers back into the market.

Find homes for sale in Santa Barbara, or search listings in your area.

Phoenix

Average short-sale price: $149,094.
Average discount vs. non-distressed sales: 37.84 percent.

Though investors make up a large chunk of the short sale and foreclosure buying activity, Phoenix has the added benefit of everyday homebuyers getting in on the action, too. Short sale and foreclosure purchases rose 43 percent in the fourth quarter of 2012 compared to a year prior. But time is of the essence for buyers: Inventory of these properties is falling rapidly.

Find homes for sale in Phoenix, or search listings in your area.

Las Vegas

Average short-sale price: $124,555
Average discount vs. non-distressed sales: 33.4 percent

It's what's coming in the Las Vegas market that makes it ripe for real estate deals. About 8,000 homeowners in Vegas are in default on their mortgages, according to RealtyTrac, and their properties could flood the market as short sales or foreclosures very soon. "Short sales aren't going anywhere for another two to three years," Paul Rowe of Henderson, Nev.-based Shelter Realty told Market Watch.

Find homes for sale in Las Vegas, or search listings in your area.

Cleveland

Average REO sales price: $57,782
Average discount vs. non-distressed sales: 56 percent

Bank-owned homes are dirt cheap in Cleveland, and that has enticed many buyers. REOs were selling for less than $60,000 on average in Cleveland in the fourth quarter of 2012. That's a 56 percent discount on the average price of a non-distressed property there.

Find homes for sale in Cleveland, or search listings in your area.

Charlotte, N.C.

Average REO sales price: $111,260
Average discount vs. non-distressed sales: 43 percent

Bank-owned home sales in Charlotte increased 109 percent in the fourth quarter of 2012 from a year prior, according to RealtyTrac. The hike is apparently coming from new residents who are moving to Charlotte from more expensive markets like New York and Boston. These out-of-towners are using the money from the sale of their old homes to buy bank-owned properties in Charlotte in cash, Market Watch said.

Find homes for sale in Charlotte, or search listings in your area.

See also:
Homebuyers Searching for Deals in Hurricane Sandy Wreckage

10 Best Cities to Buy Foreclosures in 2013
10 Best Cities to Own a Home

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21 PHOTOS
Cities With the Priciest and Cheapest Foreclosures
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5 Cities Where Homes Are Still Cheap

Average foreclosure sale price: $338,509
Average discount: 37.13%
Number of foreclosure sales: 493
Percent of all sales: 31.79%

Find foreclosures for sale in Santa Maria, Calif., or search foreclosure listings in your area.

Photo: Flickr/jbcurio

Average foreclosure sale price: $345,440
Average discount: 26.28%
Number of foreclosure sales: 4,142
Percent of all sales: 32.19%

Find foreclosures for sale in San Diego, or search foreclosure listings in your area.

Photo: Flickr/Andre S. Ribeiro

Average foreclosure sale price: $349,469
Average discount: 25.65%
Number of foreclosure sales: 170
Percent of all sales: 25.41%

Find foreclosures for sale in Napa, Calif., or search foreclosure listings in your area.

Photo: Flickr/jimg944

Average foreclosure sale price: $352,368
Average discount: 21.18%
Number of foreclosure sales: 318
Percent of all sales: 24.63%

Find foreclosures for sale in Paso Robles, Calif., or search foreclosure listings in your area.

Photo: Flickr/kla4067

Average foreclosure sale price: $354,136
Average discount: 35.54%
Number of foreclosure sales: 13,986
Percent of all sales: 33.16%

Find foreclosures for sale in Los Angeles, or search foreclosure listings in your area.

Photo: Flickr/adamfarnsworth

Average foreclosure sale price: $359,105
Average discount: 33.09%
Number of foreclosure sales: 245
Percent of all sales: 23.97%

Find foreclosures for sale in Santa Cruz, Calif., or search foreclosure listings in your area.

Photo: Flickr/Ed Bierman

Average foreclosure sale price: $361,813
Average discount: 20.15%
Number of foreclosure sales: 1,098
Percent of all sales: 34.79%

Find foreclosures for sale in Oxnard, Calif., or search foreclosure listings in your area.

Photo: Flickr/Clotee Pridgen Allochuku

Average foreclosure sale price: $369,343
Average discount: 43.56%
Number of foreclosure sales: 4,732
Percent of all sales: 27.02%

Find foreclosures for sale in San Francisco, or search foreclosure listings in your area.

Photo: Flickr/DominusVobiscum

Average foreclosure sale price: $461,089
Average discount: 35.69%
Number of foreclosure sales: 1,438
Percent of all sales: 21.81%

Find foreclosures for sale in San Jose, or search foreclosure listings in your area.

Photo: Flickr/four years

Average foreclosure sale price: $463,567
Average discount: 15.88%
Number of foreclosure sales: 202
Percent of all sales: 6.74%

Find foreclosures for sale in Honolulu, or search foreclosure listings in your area.

Photo: Flickr/lrargerich

Average foreclosure sale price: $62,469
Average discount: 24.22%
Number of foreclosure sales: 157
Percent of all sales: 22.36%

Find foreclosures for sale in Sebring, Fla., or search foreclosure listings in your area.

Photo: Wikimedia Commons

Average foreclosure sale price: $62,431
Average discount: 18.74%
Number of foreclosure sales: 185
Percent of all sales: 25.8%

Find foreclosures for sale in Muskegon, Mich., or search foreclosure listings in your area.

Photo: Flickr/Jim_W

Average foreclosure sale price: $60,781
Average discount: 36.63%
Number of foreclosure sales: 750
Percent of all sales: 37.06%

Find foreclosures for sale in Flint, Mich., or search foreclosure listings in your area.

Photo: Wikimedia Commons

Average foreclosure sale price: $59,584
Average discount: 56.08%
Number of foreclosure sales: 114
Percent of all sales: 9.56%

Find foreclosures for sale in Beaumont, Texas, or search foreclosure listings in your area.

Photo: Flickr/Patrick Feller

Average foreclosure sale price: $57,278
Average discount: 47.28%
Number of foreclosure sales: 628
Percent of all sales: 28.06%

Find foreclosures for sale in Toledo, Ohio, or search foreclosure listings in your area.

Photo: Flickr/Official U.S. Navy Imagery

Average foreclosure sale price: $56,832
Average discount: 51.87%
Number of foreclosure sales: 754
Percent of all sales: 24.44%

Find foreclosures for sale in Dayton, Ohio, or search foreclosure listings in your area.

Photo: Flickr/Uriel 1998

Average foreclosure sale price: $56,589
Average discount: 38.57%
Number of foreclosure sales: 242
Percent of all sales: 30.33%

Find foreclosures for sale in Saginaw, Mich., or search foreclosure listings in your area.

Photo: Flickr/Paragon Apartments

Average foreclosure sale price: $55,412
Average discount: 40.2%
Number of foreclosure sales: 137
Percent of all sales: 24.55%

Find foreclosures for sale in Springfield, Ohio, or search foreclosure listings in your area.

Photo: Wikimedia Commons

Average foreclosure sale price: $50,633
Average discount: 44.8%
Number of foreclosure sales: 108
Percent of all sales: 26.67%

Find foreclosures for sale in Lima, Ohio, or search foreclosure listings in your area.

Photo: Wikimedia Commons

Average foreclosure sale price: $42,918
Average discount: 60.19%
Number of foreclosure sales: 125
Percent of all sales: 8.07%

Find foreclosures for sale in Scranton, Pa., or search foreclosure listings in your area.

Photo: Flickr/genvessel

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