The number of Minnesota foreclosures filings in October fell sharply compared with last year.

But here's the rub: October filings were up compared with September.

RealtyTrac said Thursday that one in every 1,119 Minnesota homes in October was the subject of a foreclosure filing, compared with one in 706 nationwide. Locally, that was a 31 percent decrease from October 2011, but a 34 percent increase from the previous month.

The September-to-October increase is likely the byproduct of an unpredictable foreclosure processing system, variations in state repossession laws and an uneven economic recovery, said Daren Blomquist, RealtyTrac's vice president. He warned that the hefty 34 percent month-to-month increase is a sign that a backlog of foreclosures could flood the market in the coming months.

"It's been a bit of a roller-coaster ride over the last year," he said.

Month-to-month increases in defaults happened in more than half of the 212 metro areas tracked by the group.

"We continued to see vastly different foreclosure trends across the country in October," Blomquist said. "Depending primarily on how each state's foreclosing infrastructure was able to handle the high volume of delinquent loans during the worst of the foreclosure crisis in 2010."

The states with the biggest annual increases in foreclosure activity were New Jersey, New York and Connecticut.

Nationwide, foreclosure filings -- including default notices, scheduled auctions and bank repossessions -- were reported on 186,455 properties last month, a 3 percent increase from September but a 19 percent decline from last year. Minnesota's foreclosure rate was the 20th-highest in the nation.

While the foreclosure rate is still at troubling levels, housing experts say a strengthening housing market, an improving economy and widespread foreclosure prevention efforts are helping more Minnesotans avoid default.

Recent declines in foreclosure filings have helped stabilize home prices in the Twin Cities. In recent months, the percentage of distressed sales in the Twin Cities has fallen, according to recent data from the Minneapolis Area Association of Realtors (MAAR), eliminating some of the drag those discounted listings can have on home values.

"The market is starting to lean away from lender-owned and short-sale properties and more toward traditional sellers again," said Andy Fazendin, MAAR's president-elect.

Jim Buchta • 612-673-7376