We have been in business in Georgetown, Texas for over 3 years and have completed hundreds Short Sales for Homeowners and Realtors in the Central Texas area. No matter the situation, multiple liens, IRS issues, non-responsive lenders, deteriorated property condition, rentals, multi-family, etc. WE CAN HELP!
The short sale process is a complicated one and many claim to know how to process them...and they probably do. However the difference is, we are more than a "processing center". We understand the guidelines by which the foreclosing lenders and their investors operate which saves the lender wasted time and allows us "top-of-pile" service, greatly reducing the often very lengthy timelines involved with approval.
Proud members of the National Association of Foreclosure Prevention Professionals (www.NAFPP.org), we are the ONLY COMPANY in Central Texas with this organizations "Seal of Approval" and support of our operation.

It really depends on your strategy. I would suggest that if you are investing in real estate, NOW is a great time to buy and be a part of "what the market does". In addition, as an owner-occupant buyer, there are hundreds of great deals out there due to the downward pressure on pricing.
Buying either foreclosed homes or short sales has a positive impact in numerous ways, i.e. reduces the number of abandoned properties, helps preserve the integrity of neighborhoods, brings income back into the tax base, removes bad debt from lenders' books helping to prevent interest rate and fee increases at the lenders, etc., etc.
I could go on all day about the state of our country, the real estate market, etc., but in the interest of time, I'll agree with you that some cities are progressing faster than others. I'm located in Texas where our market is fairly strong. We haven't experienced the same severe downturns that other areas have, like CA, AZ, FL (where my Dad lives). In fact, in FL the recovery could take several more years, but the silver lining is the deals people are getting.