Home foreclosures in the Pittsburgh area dropped in July for the first time since the steadily rising pace of mortgage defaults was set in motion at the beginning of this year.

The five-county metropolitan area of Allegheny, Beaver, Butler, Washington and Westmoreland saw a collective drop in residential foreclosures of 29.1 percent in July, as 266 homes were foreclosed on for the month, down from 375 in July 2007.

"The record pace we set at the beginning of the year is slowing, which may mean 2008 won't be a record year for foreclosures after all," said Dan Murrer, vice president of RealSTATs, a real estate information company. "That's what we're hoping for.

"As of now, this is a record year for foreclosures. But the drop in July combined with the drop we're seeing thus far in August shows the tide may be turning."

Allegheny County, with 138 foreclosures, accounted for the largest share of the drop, down 93 from July of last year. Butler, Washington and Beaver counties had 10, six and two fewer foreclosures, respectively, last month compared with July 2007.

Only Westmoreland had more foreclosures in July 2008 with 64, compared with 62 last year.

For the months of January through July this year, the five-county area saw 2,491 homes lost to foreclosure, which is the highest number of foreclosures for the first seven months of the year since at least 1987.

"We're taking a wait-and-see approach for the rest of the year," Mr. Murrer said. "The more months in a row we have with fewer foreclosures, the better news that is regarding the local real estate market."