RealtyTrac says the average sales price of a foreclosure home in the Sacramento area last year was 25% below the average price of a property not in the foreclosure process. Statewide the discount was much greater, nearly 40%.

RealtyTrac's Daren Blomquist says foreclosures are such a dominant part of the Sacramento market that home sellers who aren't in foreclosure, have to lower their prices to compete.   

"There's kind of a certain tipping point. Once foreclosures account for more than half of the sales in the market you actually start to see the discount on foreclosures go down because foreclosures really are the market there."

Foreclosures account for 53% of the housing market in Sacramento.

The figures were released today as part of RealtyTrac's Year-End 2010 Foreclosure Sales Report.