In another sign that the housing crisis is winding down, Sonoma County foreclosures tumbled in 2013 to their lowest level in seven years.

County homeowners lost 449 properties at foreclosure auctions last year, down 63 percent from 1,228 foreclosures in 2012, according to real estate information service DataQuick.

The county experienced a similar decline last year in mortgage defaults, the first step in the foreclosure process.

"That's huge," said Madeline Schnapp, director of economic research for PropertyRadar, a Truckee company that tracks foreclosure and property data.

Schnapp, who resides in Sonoma County, acknowledged that foreclosures remain above pre-crash levels. And one in five California homeowners still owe more on their mortgages than their homes are worth. But both of those measures are improving and the housing market remains on a gradual recovery.

"We've gone through the bottom and we've come through the other side," she said.

Since 2007, Sonoma County has recorded more than 11,000 foreclosures, or more than one in 10 homes with a mortgage.

Foreclosures peaked in 2008 amid a historic plunge in housing prices. That year, homeowners lost a record 2,820 houses and condominiums.

But an improving economy, rising home prices and foreclosure prevention efforts have combined to bring down foreclosures across California, DataQuick President John Walsh said.

Statewide, foreclosures declined to 8,205 in the fourth quarter, down 61 percent from a year ago. Mortgage defaults fell 53 percent to 18,120.

"Some of this decline in foreclosure starts stems from the use of various foreclosure prevention efforts -#8212; short sales, loan modifications and the ability of some underwater homeowners to refinance," Walsh said in a statement. "But most of the drop is because of the improving economy and the increase in home values."

"Fewer people are behind on their mortgage payments," Walsh said. "And of those who do get into trouble, many, if not most, can sell and pay off what they owe."

In Sonoma County, lenders took back 85 properties in foreclosure proceedings during the fourth quarter, down 68.4 percent from a year earlier. Lenders sent default notices to 181 borrowers behind on their mortgage payments, a decrease of 60 percent.

The decline has changed the mix of properties placed for sale on the housing market. Foreclosures and short sales made up just 18 percent of single-family home sales last year. In contrast, in 2009 more than half of all such sales involved distressed properties.

For many real estate agents, foreclosures and short sales became a significant source of business from 2008 to 2011. Short sales involve a transaction where the price is less than the amount owed on the mortgage.

Doug Del Fava, an agent with Coldwell Banker in Santa Rosa, said for close to three years he regularly had at any given time 30 foreclosure resale properties under his supervision -#8212; some in preparation for sale, some listed for sale, some in escrow. But in 2012 the numbers began to greatly decrease.

"It was drastic," he recalled. "It kind of went from full throttle to 20 percent."

Del Fava and many other agents since have switched back to focusing on homes where the owner has equity in the property.

One agent still in the distressed market is James Madison of Coldwell Banker in Santa Rosa. He specializes in bank foreclosure properties, known as real estate owned, or REO.

In 2008, Madison sold 486 foreclosure homes and ranked 10th among agents that year for all home sales in the United States. Last year he completed nearly 60 sales, he said. A few of those properties weren't foreclosures.

Madison said he still has about 30 bank-owned properties assigned to him. But he expects the number of county foreclosures to continue to decline.

Walsh of DataQuick suggested that the hefty jump in home prices last year is giving owners a strong reason to fight foreclosure.

"There's a strong incentive to hang on," he said.