It's true... many of the buyers I talk to try to avoid foreclosures because they think the buying process for foreclosures is more complex and takes longer than traditional sales. As a Realtor who has sold literally hundreds of foreclosures in the past few years, I can honestly say that, in many respects, foreclosures are much easier to buy than a home sold by an actual homeowner.
Many people get confused between foreclosures - also called bank-owned or REO (real estate owned) properties - and short sales. Short sales are those properties where the homeowner owes more on the mortgage than the property is worth and the sellers are trying to get their mortgage holder to agree to take less than the outstandning mortgage... those sales (short sales) can indeed take much longer than a traditional sales... often many months.
Foreclosures, on the other hand, are bank-owned properties that the bank wants to sell, mitigate their loss, and get the property off their books. Those properties, contrary to popular belief, are actually very easy to buy.
And while there are some typical restrictions to buying foreclosures, like often they're sold AS-IS, and there's little negotiation after the escrow process has begun, the process overall is much like a traditional sale. Even the time lines are consistent with a traditional sale... often 30 - 45 days to close a transaction.
In addition, many people think all foreclosures are dumps or in poor condition. While that's true for some properties, many are very nice homes where the previous owners fell on hard times, but took great care of the property. I've sold many, many foreclosures that were absolutely gorgeous. So, just because it's a "foreclosure," don't automatically think it's in bad shape.
So... if you're in the market to buy, either to live in or for investment, certainly don't pass up looking at the foreclosures that are for sale. They make up a large portion of the available properties on the market... check 'em out.
Also read:
Who's Buying Distressed Properties
Foreclosure Properties Often Get Multiple Offers