Short sales were all the rage in late 2011 and early 2012, but surging demand has loan servicers with distressed properties on their hands going back to traditional foreclosure auction sales and bank-owned sales, where cash is often king, according to the latest report from data aggregator RealtyTrac. “The combination of rapidly rising home prices, along with strong demand from institutional investors and other cash buyers able to buy at the public foreclosure auction or an as-is REO home, means short sales are becoming less favorable for lenders," said RealtyTrac Vice President Daren Blomquist in a statement. Inventory shortages are part of the picture -- last week Lender Processing Services reported that after 18 straight months of declines, U.S. foreclosure inventory is now at i...