Here's a quick snapshot of foreclosure sales over the past 60 days in Orange County California.  Retail sales of foreclosure (REO) properties according to the Multiple Listing Service are down 11% from 30 days ago.  These are sales to home owners and not "courthouse steps" sales.

April 15-May 15, 2009:

• 839 REO retail sales
• 35 DOM (days on market)
• $145,221 Average Price

May 15-June 15, 2009:

• 746 REO retail sales
• 37 DOM
• $335,307 Average Price

For comparison, these are statistics for non-REO (equity and short sale) properties.

April 15-May 15, 2009:

• 1769 retail sales
• 84 DOM
• $587,656 Avg Price

May 15-June 15, 2009:

• 1798 retail sales
• 77 DOM
• $614,717 Average price

The typical REO home buyer is finding fewer choices and MUCH more competition for any property that they choose to make an offer on.  I had one seller's agent tell me not to bother offering because he had 70 offers on his REO condo.  It looks like there is still a strong demand even though interest rates have risen slightly. 

Source: SoCalMLS