Real estate foreclosures in the Denver area rocketed by 32.3 percent in the first nine months of the year, as condo overbuilding, risky loans and inflated appraisals drove the number of loan defaults to near record territory.

Through September, 14,205 foreclosures had been filed in the metro area, compared to 10,735 in the first three quarters of 2005.

The record for foreclosures was set in 1988, when 17,122 were filed from Boulder to Douglas counties.

"It shouldn't be too hard to surpass our record," economist Tucker Hart Adams said Tuesday.

Adams said many of the foreclosures seem to be in the suburban condo market.

In one troubled condo project in southeast Denver, some one-bedroom units are being sold in foreclosure for as little as $18,000 to $20,000, while they sold for $110,000 to $120,000 at their peak, said Rob Murphy, a broker with RE/MAX Alliance.

Many owners walked away from their mortgages after being slapped with huge assessments for things such as fixing the boiler system, repairing a parking garage that was in danger of collapsing, removing asbestos and dealing with pipes that were leaking thousands of gallons each day.

"The problem is it has a ripple effect," Murphy said "Appraisers are already under fire because a few bad apples were overinflating them. Now, appraisers can't justify units down the street selling for $80,000 to $90,000, when they use this for a comparable."

Mary Wenke, public trustee for Arapahoe County, said that her office is dealing with so many foreclosures that she recently automated the process.

For the first time, the entire foreclosure process can be done online, so her office doesn't have to touch a piece of paper, which should make the process more accurate and faster, she said.

Foreclosures by county*

County 2005 2006

Adams 2,420 3,231

Arapahoe 2,561 3,449

Boulder 453 585

Broomfield 86 130

Denver 2,919 3,774

Douglas 728 891

Jefferson 1,568 2,145

Total 10,735 14,205

* First nine months of 2006

Source: Public Trustee Offices