Third-worst market: Little Rock, Ark.
Former President Bill Clinton's birthplace saw foreclosure-related filings plunge 48.6% in 2012 -- but Blomquist says that might be only a temporary reprieve.
He says Little Rock's foreclosure crisis abated mostly because of a November 2011 court ruling that slowed Arkansas home seizures."The drop in foreclosures is really the result of the court's intervention rather than a natural decrease in activity," Blomquist says. "It's reduced foreclosures in the state for now, but that might not be the end of the story. Lenders are still trying to figure out how to proceed." For now, Little Rock's glut of unsold foreclosures has dropped to a 15-month supply. That's partly why the typical foreclosure buyer in the 710,000-person metro area got only a 24.3% discount in 2012 -- well below the national average.