Foreclosure filings were reported on 2.3 million U.S. properties in 2008, an increase of 81 percent from 2007 and up 225 percent from 2006, according to the RealtyTrac U.S. Foreclosure Market Report.

The steep annual increase came despite a quarterly decrease in the fourth quarter after nine consecutive quarterly increases. And the fourth quarter decrease came despite a surge in foreclosure activity in December. The conflicting trends come largely as a result of artificial pressures on the foreclosure market, according to RealtyTrac CEO James J. Saccacio.

“Clearly the foreclosure prevention programs implemented to-date have not had any real success in slowing down this foreclosure tsunami. And the recent California law, much like its predecessors in Massachusetts and Maryland, appears to have done little more than delay the inevitable foreclosure proceedings for thousands of homeowners," he said, referring to California SB 1137, which went into effect Sept. 15, 2008, and required lenders to contact distressed homeowners about their intent to foreclosure 30 days before filing a Notice of Default.

That law had a noticeable impact on Notice of Default filings in California, with those filings decreasing from around 44,000 in August to around the 20,000 level in September, October and November. But then NOD filings spiked back up to more than 40,000 in December.